How to identify Current assets and Non Current assets

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Daya

Daya (Querist)
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22 March 2023 how to identify current assets and non current assets while making balance sheet under schedule III.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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22 March 2023 Current assets are a company's short-term assets; those that can be liquidated quickly and used for a company's immediate needs. Noncurrent assets are long-term and have a useful life of more than a year. Examples of current assets include cash, marketable securities, inventory, and accounts receivable.

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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23 March 2023 GENERAL INSTRUCTIONS FOR PREPARATION OF BALANCE SHEET (per Schedule III)
1. An asset shall be classified as current when it satisfies any of the following criteria:—
(a) it is expected to be realised in, or is intended for sale or consumption in, the company’s normal operating cycle;
(b) it is held primarily for the purpose of being traded;
(c) it is expected to be realised within twelve months after the reporting date; or
(d) it is cash or cash equivalent unless it is restricted from being exchanged or
used to settle a liability for at least twelve months after the reporting date.
All other assets shall be classified as non-current.
2. An operating cycle is the time between the acquisition of assets for processing and their realisation in cash or cash equivalents. Where the normal operating cycle cannot be identified, it is assumed to have a duration of twelve month

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