All
of you must have seen some balance sheets or you must have studied in class XI
or XII or in graduation that are generally prepared based on division I but
balance sheets of listed entities are prepared based on Division II. the
balance sheet deserves more attention than Wall Street has been willing to
accord it for many years past. By way of introduction
to
this section of our work, let us list five types of information and guidance
that
the investor may derive from a study of the balance sheet:
1.
It shows how much capital is invested in the business.
2.
It reveals the ease or stringency of the company’s financial condition, i.e.,
the
working-capital position.
3.
It contains the details of the capitalization structure.
4.
It provides an important check upon the validity of the reported earnings.
5.
It supplies the basis for analyzing the sources of income.
So
in order to understand the fundamentals of company We have to understand balance
sheet, Now take a look on balance sheet of Reliance Industries Limited. Balance Sheet
Balance Sheet
as at 31st March, 2018
(` in
crore)
|
|
Notes
|
As at
31st March, 2018 |
As at
31st March, 2017 |
|
|
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|
ASSETS
|
|||
|
Non-current Assets
|
|
|
|
|
Property, Plant and Equipment
|
1
|
1,91,879
|
1,45,486
|
|
Capital Work-in-Progress
|
1
|
92,581
|
1,28,283
|
|
Intangible Assets
|
1
|
9,085
|
9,092
|
|
Intangible Assets Under Development
|
1
|
6,902
|
4,458
|
|
Financial Assets
|
|
|
|
|
Investments
|
2
|
1,71,945
|
1,40,544
|
|
Loans
|
3
|
17,699
|
10,418
|
|
Other Non-current Assets
|
4
|
3,522
|
2,184
|
|
Total Non-Current Assets
|
|
4,93,613
|
4,40,465
|
|
Current Assets
|
|
|
|
|
Inventories
|
5
|
39,568
|
34,018
|
|
Financial Assets
|
|
|
|
|
Investments
|
6
|
53,277
|
51,906
|
|
Trade Receivables
|
7
|
10,460
|
5,472
|
|
Cash and Cash Equivalents
|
8
|
2,731
|
1,754
|
|
Loans
|
9
|
3,533
|
4,900
|
|
Other Financial Assets
|
10
|
3,856
|
3,372
|
|
Other Current Assets
|
12
|
10,487
|
4,859
|
|
Total Current assets
|
|
1,23,912
|
1,06,281
|
|
Total Assets
|
|
6,17,525
|
5,46,746
|
|
EQUITY AND LIABILITIES
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|||
|
Equity
|
|
|
|
|
Equity Share Capital
|
13
|
6,335
|
3,251
|
|
Other Equity
|
14
|
3,08,312
|
2,85,062
|
|
Total Equity
|
|
3,14,647
|
2,88,313
|
|
Liabilities
|
|
|
|
|
Non-current liabilities
|
|
|
|
|
Financial Liabilities
|
|
|
|
|
Borrowings
|
15
|
81,596
|
78,723
|
|
Provisions
|
16
|
2,205
|
2,118
|
|
Deferred tax liabilities (Net)
|
17
|
27,926
|
24,766
|
|
Other Non-Current Liabilities
|
18
|
504
|
-
|
|
Total non-current liabilities
|
|
1,12,231
|
1,05,607
|
|
Current liabilities
|
|
|
|
|
Financial Liabilities
|
|
|
|
|
Borrowings
|
19
|
15,239
|
22,580
|
|
Trade Payables
|
20
|
88,675
|
68,161
|
|
Other Financial Liabilities
|
21
|
48,250
|
43,920
|
|
Other Current liabilities
|
22
|
37,565
|
16,897
|
|
Provisions
|
23
|
918
|
1,268
|
|
Total Current Liabilities
|
|
1,90,647
|
1,52,826
|
|
Total Liabilities
|
|
3,02,878
|
2,58,433
|
|
Total Equity and Liabilities
|
|
6,17,525
|
5,46,746
|
|
Significant Accounting Policies
|
|
|
|
|
See accompanying Notes to the Financial Statements
|
1 to 41
|
|
|
We will learn to interpret and
analyze each aspect as per IND AS issued. Along with Balance sheet Changes in
Equity is also prepared, Now take a look at changes in balance sheet
A. Equity Share Capital
(` in crore)
|
Balance at the beginning
of the reporting period i.e. 1st April, 2016 |
Change in Equity
Share Capital during the year 2016-17 |
Balance at the end
of the reporting period i.e. 31st March, 2017 |
Change in Equity
Share Capital during the year 2017-18 |
Balance at the end
of the reporting period i.e. 31st March, 2018 |
|
3,240
|
11
|
3,251
|
3,084
|
6,335
|
B. Other Equity
(` in crore)
|
|
Balance at the
beginning of the reporting period i.e.1st April, 2016 |
Total
Comprehensive Income for the Year |
Transfer to/
(from) Retained Earnings |
On Employee
Stock Options |
Balance at the end
of the reporting period i.e.31st March, 2017 |
|
|
|||||
|
As at 31st March, 2017
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|||||
|
Share Application Money Pending Allotment
|
8
|
|
|
(4)
|
4
|
|
|
|
|
|
|
|
|
Reserves and Surplus
|
|
|
|
|
|
|
Capital Reserve
|
291
|
-
|
-
|
-
|
291
|
|
Capital Redemption Reserve
|
48
|
-
|
-
|
-
|
48
|
|
Securities Premium Reserve
|
48,387
|
-
|
-
|
693
|
49,080
|
|
Debenture Redemption Reserve
|
1,117
|
-
|
-
|
-
|
1,117
|
|
Share Based Payments Reserve
|
18
|
-
|
-
|
(2)
|
16
|
|
General Reserve
|
1,75,210
|
-
|
24,790
|
-
|
2,00,000
|
|
Retained Earnings
|
22,850
|
31,425
|
(24,790)
|
-
|
29,485
|
|
|
|
|
|
|
|
|
Other Comprehensive Income
|
2,829
|
2,192
|
-
|
-
|
5,021
|
|
|
|
|
|
|
|
|
Total
|
2,50,758
|
33,617
|
-
|
687
|
2,85,062
|
(` in crore)
|
|
Balance at the
beginning of the reporting period i.e.1st April, 2017 |
Total
Comprehensive Income for the Year |
Dividends
|
Tax on
Dividend |
Transfer
to/ (from) Retained Earnings |
On
Employee Stock Options |
Issue of
Bonus share |
Balance at
the end of the reporting period i.e.31st March, 2018 |
|
|
||||||||
|
As at 31st March, 2018
|
||||||||
|
Share Application Money Pending Allotment
|
4
|
-
|
-
|
-
|
-
|
11
|
-
|
15
|
|
|
|
|
|
|
|
|
|
|
|
Reserves and Surplus
|
|
|
|
|
|
|
|
|
|
Capital Reserve
|
291
|
-
|
-
|
-
|
-
|
-
|
-
|
291
|
|
Capital Redemption Reserve
|
48
|
-
|
-
|
-
|
-
|
-
|
(48)
|
-
|
|
Securities Premium Reserve
|
49,080
|
-
|
-
|
-
|
-
|
126
|
(3,032)
|
46,174
|
|
Debenture Redemption Reserve
|
1,117
|
-
|
-
|
-
|
4,134
|
-
|
-
|
5,251
|
|
Share Based Payments Reserve
|
16
|
-
|
-
|
-
|
-
|
(4)
|
-
|
12
|
|
General Reserve
|
2,00,000
|
-
|
-
|
-
|
25,000
|
-
|
-
|
2,25,000
|
|
Retained Earnings
|
29,485
|
33,612
|
(3,255)
|
(661)
|
(29,134)
|
4
|
-
|
30,051
|
|
|
|
|
|
|
|
|
|
|
|
Other Comprehensive Income
|
5,021
|
-
|
-
|
-
|
-
|
-
|
1,518
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
2,85,062
|
30,109
|
(3,255)
|
(661)
|
-
|
137
|
(3,080)
|
3,08,312
|
First change you will notice in
balance sheet is that assets and liabilities are classified under different
heads. You will notice new heads like Financial liabilities and Financial
Assets. There are many changes in INDAS apart from presentation, as INDAS have
different aspect of accounting than AS which were earlier issued by ICAI.
We will learn about
interpreting it in later posts.
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