Format for Non-Corporate entities mandatory or not? Netizens discuss

Many professionals are confused regarding the financial statement formats which are provided by the Institute of Chartered Accountants of India (ICAI) for non-corporate entities whether they are just recommended or actually compulsory. This confusion mostly comes from the changes made in ICAI’s latest guidance documents.

CA Abhas Halakhandi Writes: While the Technical Guide to Financial Statements for Non-Corporate Entities earlier described the formats as merely “recommended”, the latest Guidance Note, applicable from FY 2024–25, marks a decisive shift: It uses the term “shall be” a strong directive that clearly signals the mandatory application of the prescribed formats

📘 Is Non-Compliance with Revised Financial Statement Formats by Non-Corporate Entities a Reportable Deviation?

The intention of @theicai is unambiguous

While the Technical Guide to Financial Statements for Non-Corporate Entities earlier described the formats as merely… pic.twitter.com/GVmocKwXIO

— Abhas Halakhandi (@AbhasHalakhandi) June 29, 2025

However, there are other views to this: CA Hemanthkumar Ranka writes, until the ITR forms are changed, ICAI should not madate this, as it would be an unuseful activity.

As per CA Suraj Lakhotia the compendium on Guidance Note on Accounting clearly states that these are recommendatory in nature unless it is specified as mandatory.

CA Himank Singla has pointed out confusion amid CAs if ICAI formats for non-corporate entities are recommended or mandatory

Many CAs are confused over whether the ICAI formats for non-corporate entities are recommended or mandatory….

Let’s clear the air 👇

The older Technical Guide said “recommended” – fair enough.

But the updated Guidance Note now says:
Financials “shall be” in the prescribed… pic.twitter.com/iLK8wjlUun

— CA Himank Singla (@CAHimankSingla) June 28, 2025

Its High time that ICAI should release clarification on the same.