Amortisation of expenses

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Chitra Nair (Querist)
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07 January 2011 Our company is a privately owned one with two major group of family holding the shares (say group A and group B). Recently, group B purchased all the shares of group A and also made a family settlement by giving away the land, building etc. as a consideration. Various cost were incurred for the same like legal expenses, valuation fees etc. The expenses proposed to be amortized equally in the company's books for a period of 5yrs. Our Auditors are now saying that the said costs cannot be amortized in the books and has to be expensed out fully. This would be a big hit to the company's P&L. Please advise me about the treatment of the expenses based on the applicable accounting standard and also the provisions of the Companies Act, if any.

Chitra Nair

Chitra Nair (Querist)
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17 January 2011 Dear Experts,

Please reply to the query.
Its urgent.
Thanks in advance.

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