SCHEDULE 2

RESERVES & SURPLUS

Guidelines of RBI for Compilation of Financial Statements

Reserves & Surplus (Schedule 2):

• Statutory Reserves : Reserves created in terms of Section 17 or another section of Banking Regulation Act, must be separately disclosed.
  
  
• Capital Reserves : The expression 'Capital Reserve' shall not include any amount regarded as free for distribution through the Profit and Liss Account. Surplus on revaluation should be treated as Capital Reserves. Surplus on translation of the financial statements of foreign branches (which includes fixed assets also) is not a revaluation reserve.
  
  
• Share Premium : Premium on issue of share capital may be shown separately under this head.
  
  
• Revenue and other Reserves : The expression 'Revenue Reserve' shall mean any reserve other than capital reserve. This item will include all reserves, other than those separately classified. This expression 'reserve' shall not include any amount, written-off or retained by way of providing for depreciation, renewals or diminution in value of assets or retained by way of providing for any known liability.
  
  
• Balance of Profit : Includes balance of profit after appropriation. In case of loss the balance may be shown as a deduction.

Notes : General

Movement in various categories of reserves should be shown as indicated in the schedule.