17 September 2013
Dear sir, there is a huge balances of the advances collected from the patients and which is unadjusted for a long period in the balance sheet.
What is the treatment to be done for old advances recived in the books.
17 September 2013
Before providing any treatment to these advances, the current position of these advances need to be considered:
1. If the hospital has an intent to adjust these advances against future revenue to be received from patients, then the advances shall continue to be classified under current liabilties in the balance sheet. But this intent should be very clear and justifiable.
2. If there is no such intent or the intent is not justified, then these advances should be written back in the books and incomised for the year.
CAclubindia
