AS applicable to Civil Contractors
This query is : Open
23 July 2009
I want to know which Accounting Standard is applicable for recognising revenue in case of a Civil Contractor - AS 7 Construction Contracts, or AS 9 Revenue Recognition.
The individual is engaged in pure civil contract works, which includes, Painting, renovation, Repairing etc of Buildings, Flats, etc, and specifically does not include Construction, or Redevelopment projects.
Para 8.3 of AS7 mentions that
"Contracts for rendering of services which are directly related to the construction of assets" are to be classified as Construction.
The question that arises here, is that whether a Civil Contractor can be covered under AS7 on the basis of the above-mentioned grounds or not.
Please reply quickly, THANKS IN ADVANCE!!!
The individual is engaged in pure civil contract works, which includes, Painting, renovation, Repairing etc of Buildings, Flats, etc, and specifically does not include Construction, or Redevelopment projects.
Para 8.3 of AS7 mentions that
"Contracts for rendering of services which are directly related to the construction of assets" are to be classified as Construction.
The question that arises here, is that whether a Civil Contractor can be covered under AS7 on the basis of the above-mentioned grounds or not.
Please reply quickly, THANKS IN ADVANCE!!!
23 July 2009
When you read the definition of construction contract in AS 7; it means the contract for the construction of an asset or assets....
When the contract specifically excludes construction of assets, it will not be covered by AS 7 as AS 7 itself concentrate on construction contract and also it excludes as per definition itself AS 9 will be applicable in my openion
When the contract specifically excludes construction of assets, it will not be covered by AS 7 as AS 7 itself concentrate on construction contract and also it excludes as per definition itself AS 9 will be applicable in my openion
25 July 2009
Thanks for reply, we too thought the same, but then we also have to consider what is to be INCLUDED in a CONSTRUCTION CONTRACT.
And then we have to take into account, the Para 8.3 of AS7 which mentions that
"Contracts for rendering of services which are directly related to the construction of assets" are TO BE INCLUDED in CONSTRUCTION CONTRACTS.
It would be of great help if you can give an opinion in view of these facts. Thanks for your reply once again!!
And then we have to take into account, the Para 8.3 of AS7 which mentions that
"Contracts for rendering of services which are directly related to the construction of assets" are TO BE INCLUDED in CONSTRUCTION CONTRACTS.
It would be of great help if you can give an opinion in view of these facts. Thanks for your reply once again!!
25 July 2009
Thanks for reply, we too thought the same, but then we also have to consider what is to be INCLUDED in a CONSTRUCTION CONTRACT.
And then we have to take into account, the Para 8.3 of AS7 which mentions that
"Contracts for rendering of services which are directly related to the construction of assets" are TO BE INCLUDED in CONSTRUCTION CONTRACTS.
It would be of great help if you can give an opinion in view of these facts. Thanks for your reply once again!!
And then we have to take into account, the Para 8.3 of AS7 which mentions that
"Contracts for rendering of services which are directly related to the construction of assets" are TO BE INCLUDED in CONSTRUCTION CONTRACTS.
It would be of great help if you can give an opinion in view of these facts. Thanks for your reply once again!!
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