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Schedules of Financial Statements





When the company reports its financial statements, they usually report the full statement in the beginning and then follow it up with a detailed explanation.

Have a look at the snapshot of one of ARBL’s financial statement (balance sheet)


Each particular in the financial statement is referred to as the line item. For example the first line item in the Balance Sheet (under Equity and Liability) is the share capital (as pointed out by the green arrow). If you notice, there is a note number associated with share capital. These are called the ‘Schedules’ related to the financial statement. Looking into the above statement, ARBL states that the share capital stands at Rs.17.081 Crs (or Rs.170.81 Million). As an investor I obviously would be interested to know how ARBL arrived at Rs.17.081 Crs as their share capital. To figure this out, one needs to look into the associated schedule (note number 2). Please look at the snapshot below:


Of course, considering you may be new to financial statements, jargon’s like share capital make not make much sense. However the financial statements are extremely simple to understand, and over the next few chapters you will understand how to read the financial statements and make sense of it. But for now do remember that the main financial statement gives you the summary and the associated schedules give the details pertaining to each line item.


Key takeaways from this chapter
The Annual Report (AR) of a company is an official communication from the company to its investors and other stakeholders
The AR is the best source to get information about the company; hence AR should be the default choice for the investor to source company related information
The AR contains many sections, with each section highlighting certain aspect of the business
The AR is also the best source to get information related to the qualitative aspects of the company
The management discussion and analysis is one of the most important sections in the AR. It has the management’s perspective on the overall economy of the country, their outlook on the industry they operate in for the year gone by (what went right and what went wrong), and what they foresee for the year ahead
The AR contains three financial statements – Profit & Loss statement, Balance Sheet, and Cash Flow statement
The standalone statement contains the financial numbers of only the company in consideration. However the consolidated numbers contains the company and its subsidiaries financial numbers.

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