Method of accounting

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Raza Murad.A.R (Querist)
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27 June 2012 Is cash basis of accounting by a private company permitted ?
A.S 1 applicable for all enterprises.It also says about fundamental accounting assumptions.

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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28 June 2012 Section 209 of the Companies Acr requires that books of accounts shall be maintained on mercantile/accrual basis.

Section 209 is applicable to ALL companies.

So a private limited company has to maintain books of accounts on accrual basis.

It CANNOT maintain books of accounts on cash basis.

It will be violation of Section 209 and AS 1.

Raza Murad.A.R

Raza Murad.A.R (Querist)
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30 June 2012 Thank you sir :-)

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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30 June 2012 You are welcome. You should use the thanks button to convey your thanks.

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