Accotunting of Accrued Interest
This query is : Resolved
09 May 2011
As per the Mercantile System the expenses/ income due/ accrued should be provided in the books of account. My query is that as per the RBI Guidline the interest on the Saving Bank Account should be calculated on the daily basis however in the books of the account of bank such interst is provided at the end of the month and not on daily basis. So whether there is violation of the Companies Act, 1956?
09 May 2011
Please dont confuse with the wordings. As per RBI Guideline, the interest on savings account should be "calculated" on daily basis, but should be "credited" quarterly or half-yearly. So, calculation in on daily closing balances, but the credit of the same is periodically. And the interest is to be provided in the books as and when credited by the bank.
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