X is a private ltd. company. In its books of accounts the company has not written off the incorporation expenses and it is shown under the "Miscellaneous expenses(Assets)" every year since its incorporation. On the audit of the books,if the above situation arises what an auditor should do? As the amount of the expenditure is only 7000, whether the company can write off the 100% amount in the present year ? If so what are the tax consequences ? How the deferred tax liability is calculated in such situation ?
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