Export sales

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MADHU POKHAREL (Querist)

04 July 2013 Dear All,
This is the case of exporter- One of our client record Export sales after received Bill of Leading (i.e. first dispatched the good from office premises and after loading on ship, B.L. will received and sales will booked.) this process of booking of sales has been followed whole of the year.
In the march 2013, some of goods purchased and dispatched from office premises but B.L received in April. Whether sales booked on March or April?

Please suggest about the accounting and Taxation issues.

Ganeshbabu K

Ganeshbabu K (Expert)

04 July 2013 As per AS-9 (REVENUE RECOGNITION)

Sales should be recognized when all significant risks rewards incidental to ownership transferred to buyer..

Please verify the terms and conditions of sale transactions.and understand at which point of time your risk is transferred to buyer...

In your case it seems buyer responsibility starts after goods shipped and locked for which we will get a proof BILL OF LADING

if that is the case their treatment is correct..

So what ever goods despatched will march 31 but BL date says after 1st april..you need to account this as goods in transit

Thanks & regards
Ganesh babu k

MADHU POKHAREL

MADHU POKHAREL (Querist)

05 July 2013 Thanks Mr. Ganesh Babu jee.

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