Omission of expense

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KRISHNA PRIYA P B (Querist)
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01 July 2013 while preparing annual accounts 2012-2013 it has been noticed that pension paid during the previous year 2011-2012 amounted to one crore is omitted to include in that year. How can i treat the omitted expense in current year.

Karan Teli

Karan Teli (Expert)
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01 July 2013 Treat as per.prior period item, it is an error. Surprisingly thisamount has material effect so roundabout if it is an adjusting event or not and adjust it. Clearly disclose the same at various areas. IT EFFECTS MSTERIALTY TO LARGER EXTENT

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KRISHNA PRIYA P B

KRISHNA PRIYA P B (Querist)
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02 July 2013 some of the expert suggest me to write off to profit and loss account.and show as deduction from capital. is that right??

Karan Teli

Karan Teli (Expert)
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03 July 2013 Accounting standards do not suggest this, they suggest you for above treatments and if things are planned out to be done in illegal way then you can follow that. But when capital account has to be reconciled by a third party the same has to be evidenced and supported.

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