Accounting entry on gratuity
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
14 October 2011
Sir
I have made a provision of gratuity in the Balance Sheet 2009-10 but during 2010-11 some employees left the job without completing 5 years so that their amount will be reverse while calculating the gratuity provision for the year 2010-11.
Pls. advise
Thanks
I have made a provision of gratuity in the Balance Sheet 2009-10 but during 2010-11 some employees left the job without completing 5 years so that their amount will be reverse while calculating the gratuity provision for the year 2010-11.
Pls. advise
Thanks
21 October 2011
Yes, the provision as at 31 Mar 11 will have to be made for live employees on that date.
It will be determined by acturial valuation.
for example, if opening liability was Rs.100/- and the valuation as at 31 Mar 11 comes to Rs.95/-, than Rs.5 will be credited to P&L account.
Please refer AS 15- Employee Benefits for detailed accounting
It will be determined by acturial valuation.
for example, if opening liability was Rs.100/- and the valuation as at 31 Mar 11 comes to Rs.95/-, than Rs.5 will be credited to P&L account.
Please refer AS 15- Employee Benefits for detailed accounting
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