Last Updated: June 2026 Reviewed by CA Sundram Gupta · Founder, Patron Accounting LLP

Stock Statement Template & Drawing Power Calculator

TL;DR

Enter your eligible stock, creditors, eligible debtors and the bank margins and this free tool computes your drawing power (DP) on a cash-credit / working-capital limit, the headroom against your sanctioned limit, and whether the account is in order. It also gives a copy-ready stock statement format (Parts A–E: stock, debtors, creditors, insurance, certification). DP = paid stock × (1 − stock margin) + eligible debtors × (1 − debtor margin); margins are typically 25% on stock and 40% on debtors, per your sanction letter.

Calculate Drawing Power

Enter amounts in ₹ as on your statement date. Use only paid & insured stock and eligible (within-ageing) debtors.

This calculator requires JavaScript. Please enable JavaScript, or apply the formula DP = (Stock − Creditors) × (1 − stock margin) + Debtors × (1 − debtor margin) manually.

Assets & Creditors

Eligible Stock (Inventory)

Paid & insured; exclude obsolete / over-age stock.

Creditors for Purchases

Deducted from stock to get paid stock.

Eligible Book Debts (Debtors)

Within ageing limit (e.g. ≤ 90 days).

Sanctioned CC / WC Limit

Drawing is the lower of DP or this limit.

Margins (from sanction letter)

Stock Margin %

Typical 25% (borrower gets 75%).

Debtor Margin %

Typical 40% (borrower gets 60%).

CC Outstanding (optional)

To check if the account is in order.

Drawing Power (DP)

—

Copy-ready stock statement (Parts A–E)

Want this filed and reconciled every month?

A Chartered Accountant prepares your monthly stock statement, reconciles it to your books, and keeps your drawing power optimised so the CC account stays in order.

+91 945 945 6700 WhatsApp Email

How to Use the Stock Statement Tool

Enter eligible stock and creditors — only paid, insured, within-ageing stock; creditors for purchases are deducted to get paid stock.
Enter eligible book debts — receivables within the sanction's ageing limit (commonly 90 days).
Enter the margins from your sanction letter — defaults are 25% on stock and 40% on debtors; change them to match your terms.
Add the sanctioned limit (and optionally the CC outstanding). The tool returns DP, the headroom, an in-order / out-of-order flag, and a copy-ready statement.

Pair this with the working capital calculator and the cash conversion cycle calculator to see how inventory and receivables drive your funding need.

CA Tip: The margins and the debtor ageing limit are bank-specific — always read them off your sanction letter rather than assuming the 25%/40% defaults. The wrong margin changes DP materially.

What Is a Stock Statement?

A stock statement is the periodic declaration a borrower files with its bank against a cash credit (CC) or working-capital limit, showing the value of stock, book debts and creditors as on a date. The bank uses it to set the drawing power — the amount actually available to draw, which can be less than the sanctioned limit.

It is a post-sanction credit-monitoring tool: by updating DP from each statement, the bank keeps the borrowing backed by current, eligible assets. It is usually a monthly (sometimes quarterly) condition of the sanction, and for companies it connects to the auditor's checks under CARO 2020 Clause (ii) on inventory and bank stock statements — a reporting requirement framed by the ICAI.

The Drawing Power Formula

Paid Stock = Eligible Stock − Creditors for purchases
Net Stock = Paid Stock × (1 − Stock Margin)
Net Debtors = Eligible Debtors × (1 − Debtor Margin)

Drawing Power = Net Stock + Net Debtors
Available to draw = lower of (DP, Sanctioned Limit)

Margins are the borrower's own contribution that the bank does not finance — typically 25% on stock (so 75% is funded) and 40% on debtors (60% funded), as specified in the sanction letter. If the CC outstanding exceeds DP, the account is treated as irregular or out of order. The drawing-power discipline traces back to the Tandon and Chore committee framework adopted by the Reserve Bank of India.

A Worked Example

Suppose a trading firm has a sanctioned cash credit limit of ₹12,00,000. Its month-end stock statement shows eligible stock of ₹15,00,000, creditors for purchases of ₹3,00,000, and eligible book debts (within 90 days) of ₹5,00,000. The sanction letter sets a 25% margin on stock and 40% on debtors.

Paid stock = 15,00,000 − 3,00,000 = ₹12,00,000.
Net stock = 12,00,000 × (1 − 25%) = ₹9,00,000.
Net debtors = 5,00,000 × (1 − 40%) = ₹3,00,000.
Drawing power = 9,00,000 + 3,00,000 = ₹12,00,000.
Available to draw = lower of DP (₹12,00,000) and limit (₹12,00,000) = ₹12,00,000.

Here the firm can use its full limit. If creditors had been higher — say ₹6,00,000 — paid stock would fall to ₹9,00,000, net stock to ₹6,75,000, DP to ₹9,75,000, and only that lower figure could be drawn even though the sanctioned limit is unchanged. That sensitivity is exactly why banks recompute DP from every statement, and why MSME borrowers registered on the Udyam portal are encouraged to keep clean, current stock records.

The Five Parts of a Stock Statement

Part	Contents
Part A — Stock	Stock by category: raw material, work in progress, finished goods, stores/spares (paid & insured).
Part B — Book debts	Debtor ageing analysis; only debts within the eligible age count for DP.
Part C — Creditors	Creditors for purchases, deducted from stock to arrive at paid stock.
Part D — Insurance	Insurance policy details covering the hypothecated stock.
Part E — Certification	Borrower's declaration that the statement is true and the stock is owned, paid and insured.

The copy-ready template generated above follows this Part A–E structure. For the underlying inventory metrics, see the blogs on inventory turnover and days inventory outstanding.

Need Help with Bank Stock Statements & Drawing Power?

Patron Accounting LLP supports CC/OD borrowers who must file monthly stock statements — for Pune, Mumbai, Delhi, Gurugram and pan-India clients.

+91 945 945 6700 WhatsApp Email

Common Stock Statement Mistakes

Inflating stock values — banks reconcile with purchase/sales records and physical verification; overstatement is a serious red flag.
Including ineligible stock — obsolete, slow-moving, uninsured, or over-age stock should be excluded.
Not deducting creditors — DP is on paid stock; forgetting to remove creditors overstates DP.
Counting old debtors — only debts within the ageing limit (often 90 days) are eligible.
Ignoring third-party stock — stock at job-workers or in transit may be excluded per sanction terms.
Late or wrong-format submission — a DP from a statement older than three months is treated as stale.

For a deeper checklist, see Patron's MSME stock statement guide and the net worth certificate for business loan service for the wider loan file. MSME borrowers can also explore working-capital schemes via SIDBI, and the stock-statement format itself broadly follows the practice standardised by the Indian Banks' Association.

Frequently Asked Questions

A stock statement is a periodic statement a borrower submits to its bank against a cash credit or working capital limit, declaring the value of stock (inventory), book debts (receivables) and creditors as on a date. The bank uses it to compute the drawing power — the amount the borrower may actually withdraw. It is usually a monthly or quarterly condition of the sanction and typically covers stock by category, debtor ageing, creditors, insurance and a borrower certification.

Drawing power is the maximum amount a borrower can withdraw from a sanctioned cash credit or overdraft limit at a given time, based on current eligible assets after deducting the bank's margin. The borrower may draw the lower of the drawing power or the sanctioned limit. Because DP is recalculated from each stock statement, it moves with the value of paid stock and eligible debtors, keeping the borrowing backed by real assets.

Drawing power equals the net value of stock plus the net value of debtors. Net value of stock is paid stock — that is total eligible stock less creditors for purchases — multiplied by one minus the stock margin. Net value of debtors is eligible book debts within the ageing limit multiplied by one minus the debtor margin. The two nets are added to give DP, which is then compared with the sanctioned limit; the borrower can use whichever is lower.

The margin is the borrower's own contribution that the bank does not finance. In most cases the margin on stock is around 25 per cent, so the borrower gets credit for 75 per cent of paid stock, and the margin on book debts is around 40 per cent, so the borrower gets credit for 60 per cent of eligible debtors. The exact percentages are specified in the sanction letter and vary by bank and industry.

Paid stock is the stock for which the borrower has actually paid the supplier — total stock less the creditors for purchases. Banks finance only paid stock, because stock still owed to suppliers is effectively financed by those creditors, not by the borrower's own funds. Deducting creditors prevents double financing of the same inventory and ensures the drawing power reflects assets genuinely backed by the borrower.

Only paid and insured stock counts, and obsolete or slow-moving items and stock beyond the ageing limit are excluded. Book debts are usually eligible only up to a specified age — commonly 90 days, though some sanctions allow longer. Stock lying at third-party locations, goods in transit and ineligible categories may be excluded depending on the sanction terms. Always apply the eligibility rules in your own sanction letter before computing DP.

If the cash credit outstanding is higher than the drawing power, the account is treated as irregular or out of order. The bank may ask the borrower to deposit the excess, reduce drawings, or provide additional security. Persistent irregularity can affect the account classification and the borrower's credit standing, so the stock statement should be prepared accurately and the drawings kept within the computed DP.

Most cash credit sanctions require a monthly stock statement, due shortly after each month end, while some facilities accept quarterly statements. The frequency and due date are set in the sanction letter. A drawing power computed from a statement older than three months is generally treated as outdated, and the outstanding based on such a stale statement can be considered irregular, so timely submission matters.

A typical bank stock statement has five parts: Part A lists stock by category such as raw material, work in progress, finished goods and stores or spares; Part B is the book-debt ageing analysis; Part C lists creditors for purchases; Part D records insurance details of the stock; and Part E is the borrower's certification. The copy-ready template in this tool follows this Part A to E structure so you can adapt it to your bank's format.

Yes, the Patron Accounting Stock Statement Template and Drawing Power Calculator is completely free with no signup required. All calculations run in your browser and nothing is stored on our servers. It computes paid stock, net stock and net debtor values, drawing power and headroom against the sanctioned limit, flags whether the account is in order, and gives a copy-ready stock statement format you can finalise for your bank.

Pune | Mumbai | Delhi | Gurugram

25,000+ Businesses Trust Us