Accounting systems

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mahesh (Querist)
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24 August 2013 the business is following cash system of accounting, the cheque is issued for purchases on 27/03/2013 but cleared on 25/6/2013.on Which date purchases should be booked ? Is BRS prepared in cash systems of Accounting ?

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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24 August 2013 it should be booked on 27/3/2013 only. cash basis accounting which refers the date of payment by business, once the cheque issued the transaction can be treated as paid in cash basis accounting. when the cheque is clearing from bank is immaterial. BRS need to be prepared in cash systems of accounting as well

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