How to disclose e book inventory for e book seller

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Querist : Anonymous

Querist : Anonymous (Querist)

19 September 2016 Hello,
i am sushant ca final student , i have a query. i am doing audit of one of the e book seller company. they sell e book to customers they don't show inventory instead of they show it as capital asset WIP under fixed asset. Please tell me what its the correct discloser?

Amol S Joglekar

Amol S Joglekar (Expert)
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20 September 2016 is it e book library OR e book selling or both?
In the case of e book library, showing it as capital WIP is justified but NOT for seller

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Querist : Anonymous

Querist : Anonymous (Querist)

20 September 2016 he is a seller of e book.

Amol S Joglekar

Amol S Joglekar (Expert)
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20 September 2016 No that is not right. It is stock in hand and same shall be governed by AS 2

Querist : Anonymous

Querist : Anonymous (Querist)

20 September 2016 But they have one master file of that e book in system. how much quantity we should show as closing stock and at what value?

Amol S Joglekar

Amol S Joglekar (Expert)
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20 September 2016 I knew your next query would be about valuation. That is the reason I already mentioned AS 2...which means Accounting Standard 2.....Do the valuation as per AS 2.
The quantity which is the stock shall be shown as the closing stock

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