Investment in other businesses

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Piyush (Querist)

07 December 2011 the company is an aviation company and investing its money in hotel businesses and other tourist businesses such as amusement parks, spa, games etc.. So under which head the company has to show this investment in its books of account and what other treatment they have to give while accounting for it... Which AS is applicable?

Hari Beldona

Hari Beldona (Expert)

07 December 2011 Saparate divisons to be created in accounts that is Hospitality Division for Hotels, Tours & Travels for Tourist business etc any income or expenditure to be accounted in the appropriate divison.
AS-17 Segment Reporting is applicable

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Piyush

Piyush (Querist)

08 December 2011 Thank you sir for your reply, this is very usefull for me....

Sir one more question....

does it make any difference in accounting treatment, if those businesses where the company investing money is a related company, they are maintaining separate books of account for it and audited...also suggest for applicable AS...

Hari Beldona

Hari Beldona (Expert)

08 December 2011 Yes, company investing will be separate entity will have its own books of accounts

Then Accounting Standard 18 Related Party disclosure is to made.

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Piyush

Piyush (Querist)

10 December 2011 Thnak yo very much sir.....!!!!

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