🏢 Finance Bill 2026 — Chapter III (C)

Companies Act Amendments 2026

Finance Bill 2026 amends key Schedules of the Companies Act, 2013 — updating financial statement formats, independent director norms, and reporting requirements for CSR, depreciation, and related-party disclosures.

📋 Schedule III — Financial Statement Format

Schedule III prescribes the format for Balance Sheet and Profit & Loss Statement. The 2026 amendment introduces significant changes for FY 2026-27 financial statements:

• New disclosure: Companies must separately disclose crypto/virtual digital asset holdings and gains/losses
• ESG disclosure: Listed companies must include ESG-linked financial metrics in notes to accounts
• MSME dues: Ageing schedule for MSME creditors now mandatory for all companies (was earlier only for large companies)
• Lease liabilities: Right-of-use assets and lease liabilities must be shown as separate line items (Ind AS 116 alignment)
• Intangibles: Internally generated intangibles must be disclosed separately from acquired intangibles

👔 Schedule IV — Independent Directors Code

Schedule IV sets out the Code for Independent Directors. The 2026 amendment strengthens their accountability:

• Independent Directors must complete annual digital certification through MCA portal confirming independence
• Mandatory training on financial literacy and ESG for first-time Independent Directors
• Separate meeting of Independent Directors must be minuted and filed with RoC within 30 days
• Whistle-blower complaints addressed to Independent Directors must be resolved within 60 days
• ID’s dissent on Board decisions must be recorded and disclosed in Annual Report

📊 Schedule VI, XI & XII Amendments

• Schedule VI (Depreciation — SLM/WDV): New depreciation rates prescribed for EVs, data centre equipment, and green energy assets; useful life of software revised from 3 years to 5 years
• Schedule XI (Technical Members — NCLT): Qualifications for technical members of NCLT expanded to include insolvency professionals with 10+ years experience
• Schedule XII (Powers of NCLT): NCLT’s power to grant interim relief in oppression & mismanagement cases strengthened; timeline for final order capped at 18 months

🌱 Schedule XIV — CSR & ESG Reporting

Schedule XIV governs Corporate Social Responsibility (CSR) activities. The 2026 amendment:

• New CSR category: “Green Transition Activities” — renewable energy investments, carbon credit schemes, and EV fleet transitions now qualify as CSR
• Companies with CSR obligation > ₹50 crore must appoint a Chief Sustainability Officer (CSO)
• CSR Impact Assessment Report is now mandatory for all companies with CSR spend > ₹10 crore
• Unspent CSR funds carried forward — must be utilised within 2 years (up from 3 years) or transferred to PM Cares Fund
• ESG-linked financial disclosures in BRSR (Business Responsibility & Sustainability Report) expanded with 15 new data points