Auditor conveyance reimbursement

This query is : Open

Querist : Anonymous

Querist : Anonymous (Querist)

01 February 2011 plz tell in which accounting head the "auditors lunch and conveyance" should be debited?? whether it should be debited in the conveyance A\C or consultancy fees

plz reply......

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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01 February 2011 It can be debited " Audit expenses- Out of pocket"

Querist : Anonymous

Querist : Anonymous (Querist)

01 February 2011 not in conveyance? plz tell me the reason.

CA Debasish Banerjee

CA Debasish Banerjee (Expert)
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02 February 2011 Audit Fees is what you pay for the service recd by you. All other expenses incurred by the auditor are Audit expenses as stated by Rameshji. It is not conveyance as conveyance is what you pay to your employees / personnel for performing their duties. Auditors expenses for travelling, lunch, conveyances are 1) incurred by you to be paid directly ( if you treat it as conveyance then till last year you had to pay FBT on such expenses ); 2) incurred by the auditor and you reimburse ( in such cases you have to deduct tax ); 3) expenses incurred by the Auditor and it is not reimbursable ( i.e., without any other expenses other than Audit Fees ). You book the expenses for the purpose it is incurred and in this case for Audit.

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