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Corporate affairs ministry facilitates tracking down of payments to MSMEs

Corporate affairs ministry facilitates tracking down of payments to MSMEs

The Ministry of Corporate Affairs (MCA) has made it easier for authorities to find out whether the company concerned is holding payments of vendors, especially micro, small, and medium enterprises (MSMEs) and for how many years.

From the next month, companies are required to disclose trade payables according to their ageing — less than one year, 1-2 years, 2-3 years, and more than three years — in their financial statements.


This would be divided between MSMEs and others. Within each category, there would be further sub-categories — disputed and undisputed.

On the same lines, the ageing for trade receivables will also be disclosed. Currently, companies are only required to disclose trade payables into two parts — payables to MSMEs and payables to non-MSMEs. There is no requirement to provide any ageing details.

On the matter of receivables, the only requirement is to divide it between up to six months and more than six months

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