Unbilled Payables explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
The payables ageing runs from the due date. Amounts not yet due, and amounts not yet billed, need columns of their own — and one category is expressly kept out.
The two additional columns
To tie up the amounts presented in the "total" column with the amounts presented in the financial statements or notes, two columns are added before the ageing columns:
- Unbilled — for unbilled payables; and
- Not due — for trade payables which are not due.
And a point specific to the payables side: the ageing requirement shall not apply to these trade payables not due for payment. The not-due column carries a single figure rather than being spread across buckets.
Ind AS 37 states that trade payables are liabilities to pay for goods or services that have been received or supplied and have been invoiced or formally agreed with the supplier. From which: unbilled trade payables shall include accruals which are not classified as provisions under Ind AS 37.
And the exclusion is explicit: it is clarified that a "provision" shall not be considered as unbilled trade payables.
The dividing line is degree of uncertainty. A provision is a liability of uncertain timing or amount, and provisions can be distinguished from other liabilities such as trade payables and accruals because there is uncertainty about the timing or amount of the future expenditure required in settlement. Ind AS 37 concedes that it is sometimes necessary to estimate the amount or timing of accruals, but the uncertainty is generally much less than for provisions.
So goods received in March and invoiced in April are an accrual — the obligation and amount are known, only the paperwork lags. A warranty obligation is a provision, and belongs in the provisions line, not in the payables ageing.
Due date and transaction date
Due date shall be the date by when a buyer should make payment to the supplier as per terms agreed upon between the buyer and supplier.
In case the due date is neither agreed in writing nor oral, then the disclosure needs to be prepared from the transaction date — and transaction date is defined here as the date on which the liability is recognised in the books of accounts as per the requirement of applicable standards.
That mirrors the receivables side, where the transaction date is the date the entity's right to consideration becomes unconditional under Ind AS 115.
Disputed and undisputed
The amounts to be presented under (i) MSME and (ii) Others shall include those trade payable dues that are undisputed — with disputed dues in their own two rows.
The definition of dispute carries across from the receivables discussion: a dispute is a matter of facts and circumstances of the case; dispute means disagreement between two parties demonstrated by some positive evidence which supports or corroborates the fact of disagreement. The guidance note adds a cross-reference — refer the term "dispute" as defined under the Insolvency and Bankruptcy Code, 2016.
The completed schedule
| Particulars | Unbilled | Not due | <1 yr | 1–2 | 2–3 | >3 yrs |
|---|---|---|---|---|---|---|
| MSME (undisputed) | ||||||
| Others (undisputed) | ||||||
| Disputed dues — MSME | ||||||
| Disputed dues — Others |
Common mistakes
- Including provisions among unbilled payables.
- Ageing the not-due balance across the period buckets.
- Omitting the unbilled and not-due columns so the total fails to tie.
- Using the invoice date where a contractual due date exists.