Accounting of assets imported

MEHER (STUDENT) (24 Points)

21 April 2014  

Hi,

Can someone help me with Accounting of Asssets imported under CIF Contract.

Circumstances:

X ltd., entered an offshore contract with Y Ltd., for import of assets. The title over assets will by transferred by Y Ltd., to X Ltd., through High Sea Sales. Now, the X Ltd., has to clear the goods from Customs Authorities by paying Customs Duty. As per Standard Operating Procedure the company has to account the Assets in books only when the same are received at X Ltd., premises and GRN is raised.

Queries:

1. Can X Ltd., account for the assets without rasing GRN as it is not able to clear goods from customs    authorities.

2. If No, then what will be the treatment in books.

 

Thanks in advance.