Making profit and loss statement
This query is : Resolved
30 April 2016
In the case of Power generating company till date not started operational activity. so in mention subject please guide me which expenses will be capitalized or which expenses will be reflect in profit and loss statement and which accounting standard apply ?
30 April 2016
Charge off to P & L preliminary expenses relating to formation of the company. Capitalize all the expenses till commercial operation of the plant(72 hours full load operation).
Accounting Standard AS 10, AS 11 and AS 16 applicable.
Accounting Standard AS 10, AS 11 and AS 16 applicable.
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30 April 2016
sir thanking u again
C&AG raised query about this why u r not making Profit and loss statement....they told that all the expenditure which are not direct related to project should be transferred to profit and loss statement and if any balance coming negative in profit and loss statement transferred to general reserve.
But we are not satisfied this query.
my point that till operation activity is not started why we make profit and loss statement.....?
till date we transferred all the expenditure in capital work in progress ....after operation start all the revenue nature expediture will be transfered in profit and loss statement.
please clarify that
C&AG raised query about this why u r not making Profit and loss statement....they told that all the expenditure which are not direct related to project should be transferred to profit and loss statement and if any balance coming negative in profit and loss statement transferred to general reserve.
But we are not satisfied this query.
my point that till operation activity is not started why we make profit and loss statement.....?
till date we transferred all the expenditure in capital work in progress ....after operation start all the revenue nature expediture will be transfered in profit and loss statement.
please clarify that
01 May 2016
Company formation and other related expenses can't be capitalized and charged to P & L ac so preparation of profit and loss account is necessary. Please see para 9.2 of Accounting standard 10.
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01 May 2016
i read para 9.2 of As-10, with mentioned subject i want to know that all other expenses those not related company formation will be charged in Profit and loss statement....if this type expenses incurred due to established 2*800 MW power project.....please clarify about statutory Audit fees and expenses and telephone expenses will be charged in Profit and loss statement or Capitalised......if project is not exist why we are spend this type expenses......
in waiting your reply
in waiting your reply
01 May 2016
Such expenses can be capitalized.
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