Accounting Policy to be followed in case of Trust
This query is : Resolved
Quick Summary
DHARMIK VORA
(Querist)
08 January 2020
Which Accounting Policy is followed by Trust (Public Trust)? (Cash Basis or Accrual Basis Or Both)?
For Receipt Of Grant: Receipt Basis of Accounting & For Expenses Accrual Basis of Accounting?
For Receipt Of Grant: Receipt Basis of Accounting & For Expenses Accrual Basis of Accounting?
CA R SEETHARAMAN
(Expert)
08 January 2020
Cash basis accounting is the right one.
DHARMIK VORA
(Querist)
08 January 2020
Thank You Sir For Your Prompt Replay
Let's Put at this way
Suppose i am doing audit of a particular Trust for F.Y 15-16, (Previous Year Audit is Conducted by other Auditor), while checking the Last Trust Audit Report, it's clear that Grant Income is book on Receipt Basis only. And Expenses is book on accrual basis (Bank Balance is not match with actual closing balance as per Bank Statement).
Query
1. What to do for Diff. in Bank Balance
2. For Cheque which is issued on 31st March and clear in April Month
Please Clarify
Thank You
Let's Put at this way
Suppose i am doing audit of a particular Trust for F.Y 15-16, (Previous Year Audit is Conducted by other Auditor), while checking the Last Trust Audit Report, it's clear that Grant Income is book on Receipt Basis only. And Expenses is book on accrual basis (Bank Balance is not match with actual closing balance as per Bank Statement).
Query
1. What to do for Diff. in Bank Balance
2. For Cheque which is issued on 31st March and clear in April Month
Please Clarify
Thank You
CA R SEETHARAMAN
(Expert)
08 January 2020
1 Show such differences in bank reconciliation.
DHARMIK VORA
(Querist)
08 January 2020
Can we follow Hybrid Accounting Policy?
No Information/Data is available with me for last year. I am only Available with Last Year trust Audit Report.
And From Audit Report it's clear that Hybrid Accounting System is follow. (Expenses is book on accrual basis and income on receipt basis)
No Information/Data is available with me for last year. I am only Available with Last Year trust Audit Report.
And From Audit Report it's clear that Hybrid Accounting System is follow. (Expenses is book on accrual basis and income on receipt basis)
CA R SEETHARAMAN
(Expert)
08 January 2020
Yes hybrid system can be followed.
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