The move is being made to maintain more transparency in the market. The capital markets regulator Sebi had mandated quarterly disclosures of profit and loss data of listed companies in the early 1990s. A direct impact of this was that insider trading had come down significantly.

“Sometimes companies increase their account receivables to reflect higher revenues on which cash is yet to be received. Such non-cash based revenues have been a problem in certain real estate companies. Disclosure of the same will increase transparency on quality of numbers,” a senior Mumbai investment banker said.

India has been lagging behind on disclosure norms compared to practices in the international market. Quarterly balance sheet disclosures are already necessitated in leading markets such as the US, the UK, Singapore and Australia. “The move will bring India closer to international disclosure standards,” the banker said.