Cash system accounting
This query is : Resolved
13 June 2019
Dear Sir,
My dad who was a Chartered Accountant in practice used to follow cash system of accounting while filing income tax return of his firm till 31.03.2018 and was not showing any Debtors in Balance sheet.
Now due to his sudden demise in April, 2019, we have started recovering amount from the Debtors as the firm will get dissolved in the current financial year. The amount is getting credited in Firm's bank account as we have kept the account in operation for receiving the outstanding amount.
My query is while filing income tax return for y.e. 31.03.2019 should we show the debtors amount now in Balance sheet and change the Accounting system to Mercantile while filing the return.
I am stuck in a very unwanted situation and worried about filing the firm's return since no Debtors were shown till 2018.
Please advise me on how should I go about filing the returns for F.Y. 2018-19.
Regards,
Divyesh Jain
My dad who was a Chartered Accountant in practice used to follow cash system of accounting while filing income tax return of his firm till 31.03.2018 and was not showing any Debtors in Balance sheet.
Now due to his sudden demise in April, 2019, we have started recovering amount from the Debtors as the firm will get dissolved in the current financial year. The amount is getting credited in Firm's bank account as we have kept the account in operation for receiving the outstanding amount.
My query is while filing income tax return for y.e. 31.03.2019 should we show the debtors amount now in Balance sheet and change the Accounting system to Mercantile while filing the return.
I am stuck in a very unwanted situation and worried about filing the firm's return since no Debtors were shown till 2018.
Please advise me on how should I go about filing the returns for F.Y. 2018-19.
Regards,
Divyesh Jain
14 June 2019
Continue with cash system no need to change and show debtors in BS.
17 June 2019
Thank you sir for solving my query
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