Presentation of Trade Receivables in the Financial Statements prepared in accordance with Ind AS

Ind AS Schedule III sets out the minimum requirements for disclosure on the face of the Financial Statements. For presenting trade receivables that appear under the head “Non- current assets” and “Current assets” as a separate line item, the guidelines provided by Schedule III need to be followed.

Trade Receivables is an amount that is due on account of goods sold or services rendered in the normal course of business and the company has an unconditional right on such amount of consideration.

Hence, amounts due under contractual rights, other than arising out of the sale of goods or rendering of services, cannot be considered as Trade Receivables.

A trade receivable will be treated as current if it is likely to be realized within twelve months from the date of the Balance Sheet or within the operating cycle of the business. For trade receivables outstanding, the ageing schedule as prescribed in Schedule III shall be given.

Ind AS Schedule III requires separate disclosure of the ageing schedule of “Trade Receivables outstanding” for both viz, the non-current and the current portion of trade receivables.

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