Gratuity - AS 15

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ankitha (Querist)
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21 April 2008 Dear sir,
For a company whose retirement Benefit is funded through a scheme administered by an Insurer what is the treatment which a company should show in its financial statement

1. Will the Investment made by Insurer will be disclosed in the B/S of Company. Will the Invt be recorded at its Fair Market Value or Original Invst value?

2.How would the difference between the investment value{equal to amt.of obligation}and its fair value be treated and whether the Increase or Decrease in the value of Invst will be included in companies P & L Account?

Kindly Suggest!

CA. Yayati Tyagi

CA. Yayati Tyagi (Expert)
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05 May 2008 i could not get you properly, are you saying that company has taken a policy under which insurer will pay for all retirement benefits and company will just pay insurance premium? if this is the case, you just account fore the premium paid. if this is not the case, write back clearly.

CA. Yayati Tyagi

CA. Yayati Tyagi (Expert)
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27 May 2008 replied

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