Stock Statement Format for Bank (CC/OD Limit): What Banks Want + Drawing Power

2026-07-26

The monthly stock statement your bank needs for a CC/OD limit: the format (stock, debtors, creditors), how drawing power is calculated with a worked example, and how to generate it straight from your books.

If your business runs on a cash-credit (CC) or overdraft (OD) limit against stock and receivables, your bank expects a stock statement every month — usually by the 7th or 10th. It's not paperwork for its own sake: the bank uses it to calculate your drawing power, the maximum you're actually allowed to draw that month. Submit it late, or under-report, and your drawing power quietly shrinks — sometimes below what you've already drawn, which triggers an awkward call from the branch. This post lays out exactly what a bank stock statement contains, how drawing power is calculated from it, and how to generate it straight from your books instead of rebuilding it by hand every month.

What a stock statement is (and why the bank wants it)

A CC/OD limit is secured against your current assets — inventory and book debts (receivables). The bank isn't lending against your factory; it's lending against goods and money-owed that can be converted to cash. Since those balances change daily, the bank re-checks them monthly via the stock statement and re-computes how much you can draw. In short: more eligible stock + debtors = higher drawing power; less = lower.

The stock statement format

The exact form varies by bank, but every stock statement carries the same three blocks, valued as on the month-end date:

BLOCK                     WHAT GOES IN IT                         VALUED AT
------------------------  --------------------------------------  ----------------
Inventory                 Raw material, WIP, finished goods,      Cost or market,
                          stores/consumables — by category        whichever is lower
Sundry Debtors            Receivables, usually only those         Invoice value,
(book debts)              within an age cap (e.g. < 90 days)      age-restricted
Sundry Creditors          Amounts owed to suppliers FOR the       Outstanding value
(for stock)               stock being financed                    payable

Two rules trip people up. Stock is valued at cost, not selling price — you can't inflate drawing power by valuing finished goods at MRP. And only debtors within the age limit count — a receivable that's 200 days old is, to the bank, unlikely to convert, so it's excluded. Getting either wrong means the statement won't reconcile with your books when the bank's inspector visits.

How drawing power is calculated

Drawing power (DP) is what the whole statement exists to produce. The bank applies a margin (its safety haircut, e.g. 25%) to your eligible current assets and subtracts creditors for stock:

DRAWING POWER =  (Eligible stock            − margin on stock)
              +  (Eligible debtors < 90 days − margin on debtors)
              −  Sundry creditors for stock

Worked example (margin 25% on stock, 40% on debtors):
  Eligible stock              ₹ 80,00,000
  less 25% margin             ₹ 20,00,000  →  ₹ 60,00,000
  Debtors < 90 days           ₹ 50,00,000
  less 40% margin             ₹ 20,00,000  →  ₹ 30,00,000
  less creditors for stock    ₹ 15,00,000  →  ₹(15,00,000)
  ---------------------------------------------------------
  Drawing Power                              ₹ 75,00,000

Your actual limit is the lower of the sanctioned limit and the drawing power. So even with a ₹1 crore sanctioned CC, if this month's DP is ₹75 lakh, ₹75 lakh is your ceiling. That's why an accurate, on-time statement directly protects your working-capital headroom.

Why it's painful every month — and how to fix it

Most SMEs rebuild the stock statement by hand: export stock from one place, pull the debtors ageing from another, guess the creditors-for-stock, key it all into the bank's template. It takes a day, it's error-prone, and it rarely ties back exactly to the books — which is the first thing a bank inspection checks.

It's far cleaner when the numbers already exist in your system:

• Inventory comes straight from a live stock ledger valued at cost — raw, WIP and finished, by category. (This is the same discipline as tracking raw-material stock without an ERP; if your godown and your books already agree, the stock block writes itself.)
• Debtors come from your receivables ageing, auto-capped at the bank's age limit.
• Creditors for stock come from payables tied to purchases.
• Drawing power is then a formula the system applies — margins in, DP out — producing the exact figure and the bank's format, monthly, in minutes.

When your goods receipts, stock and books are one connected dataset (the same reason manufacturers move off a bookkeeping-only tool like Tally), the stock statement stops being a monthly fire-drill and becomes a report you click.

Flobri Insights keeps your inventory (by category, valued at cost) and your receivables/payables ageing live in one system — so your monthly bank stock statement and drawing power generate straight from the books, in the bank's format, on time, and reconcile on inspection. See how it works.