Back to back Subcontractors
This query is : Resolved
CA VENUGOPAL KASPA
(Querist)
13 January 2023
A company engages back to back subcontractors with a commission of 1% on the Invoices Raised. Please guide me on accounting treatment to be followed as per the Accounting Standards on Revenue recognition and booking of Expenditure. The tax bills are raised only on the information received from the client to raise the bills both by the Company and Contractor. Whether this procedure is correct. Whether revenue recognition and booking of expenditure has to happen at the close of the year as WIP. Please guide me.
CA R SEETHARAMAN
(Expert)
14 January 2023
Yes, revenue recognition and booking of expenditure has to happen at the close of the year as WIP.
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