17 September 2011
dear sir, i have see in some balance sheets of company that some company is final of its accounts as per depreciation of income tax and some company final its accounts as per depreciation of company act so can anyone tell me that why are company final its accounts as per income tax depreciation.........
17 September 2011
Finalising comany's accounts with depreciation as per IT Act is incorrect. A Company must finalise its accounts providing depreciation as per Comapnies Act.
17 September 2011
It is a practise in India that a company charge depreciation as per the rate prescribed under schedule to companies act. I do not think that it is mandatory to folow that rates only. I think the co n management is free to decide the rate of depreciation to b used considering the nature and use of asset. If the rate used is other than the rate of schedule then the same should be disclosed properly in the notes to account alongwith the justification in suport of your rate used.
CAclubindia
