The Ministry of Corporate Affairs, Government of India (“MCA”) vide a notification dated March 24, 2021 (“Notification”) has amended Schedule III of the Companies Act, 2013. Through the Notification, MCA has for the first time made in mandatory for companies to mandatorily disclose any dealings in cryptocurrency or virtual currency in their balance sheets.
The Notification amends the paragraph 5. on Additional Information under the heading General Instructions for Preparation of Statement of Profit and Loss under Part II- Statement of Profit and Loss of Schedule III to include details on (i) undisclosed income; (ii) corporate social responsibility; and (iii) cryptocurrency.
The details of crypto currency required to be disclosed by the Notification are as follows:
“(xi) Details of Crypto Currency or Virtual Currency
Where the Company has traded or invested in Crypto currency or Virtual Currency during the financial year, the following shall be disclosed:-
(a) profit or loss on transactions involving Crypto currency or Virtual Currency
(b) amount of currency held as at the reporting date,
(c) deposits or advances from any person for the purpose of trading or investing in Crypto Currency/ virtual currency.”
These disclosure requirements has come into effect from April 01, 2021.
Please find a copy of the Notification containing the amendments, here.
This update has been contributed by Anurag Prasad (Associate).
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