29 September 2008
Generally ,Insurance permium are paid in annual basis and if P & M things are going to be mortgaged fo short period ,same can be capitalized.
But in long term mortgage ,capitalization of insurance premium does not make any sense
30 September 2008
Insurance premium is to be amortised over the period of cover as the same is in the nature of a revenue expenditure and a renewal premium is required to be paid on the expiry of the relevant period to keep the insurance in force.
01 October 2008
marine insurance premium being paid when the plant & machinery is brought for installation shall be capitalised as part of the plant and machinery.
any insurance premium post installation of plant and machinery would be a revenue expenditure to be charged to profit and loss account over the premium period
CAclubindia
