Accounting Treatment
This query is : Resolved
Pravesh Gadia
(Querist)
23 April 2008
What will be the accounting treatment for grants received by a PSU for making VRS payments?
24 April 2008
Refer AS 12 issued by ICAI relating to Govt Grants for clear understanding of the concept
Pravesh Gadia
(Querist)
29 April 2008
AS 12 does not give a clear view related to the VRS payment.
Chintan Gajjar
(Expert)
27 June 2008
Dear Sir,
As you have received Grant for Specific Pupose i.e. VRS Exp.
1.At the time of receipt
Bank Dr.
To Grant for VRS Exp.
2. At the time of making VRS Exp.
VRS Exp. Dr.
To Bank
3. At the time of the approval of such Exp. (If there is no provision for such approval you may direct dr. Grant A/c.)
Grant for VRS Exp. Dr.
To VRS Exp.
Balance of Grant A/c will be shown under Reserves & Surplus
4. If the Company has violated some conditions and has to repay the Grant.
Grant for VRS Exp. (By Amt. as per Book)
P & L A/c Dr. (By Balancing FIGURE)
To Bank
As you have received Grant for Specific Pupose i.e. VRS Exp.
1.At the time of receipt
Bank Dr.
To Grant for VRS Exp.
2. At the time of making VRS Exp.
VRS Exp. Dr.
To Bank
3. At the time of the approval of such Exp. (If there is no provision for such approval you may direct dr. Grant A/c.)
Grant for VRS Exp. Dr.
To VRS Exp.
Balance of Grant A/c will be shown under Reserves & Surplus
4. If the Company has violated some conditions and has to repay the Grant.
Grant for VRS Exp. (By Amt. as per Book)
P & L A/c Dr. (By Balancing FIGURE)
To Bank
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