Prior period expenses

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KAUSTUBH (Querist)
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07 February 2012 I am in trouble.
While vouching I found one bill of travel company dated 29th march 2011.
But actual expenses incurred between 14th April and 17th April.
Whether expenses should be booked as prior period as the bill date is of previous year?

CA. Hari Kishan

CA. Hari Kishan (Expert)
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07 February 2012 for the year ended 31.03.2011, should the amount be paid the amount will be accounted as advance paid.. You could also create a head pre paid expenses. In the next financial year 2011-12, transfer it to profit and loss account.

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KAUSTUBH

KAUSTUBH (Querist)
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07 February 2012 that means it has to be transferred to prior period.
My client is saying expenses incurred in current year.Just because date of bill is of previous year it can not be treated as prior period expenses.

CA. Hari Kishan

CA. Hari Kishan (Expert)
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07 February 2012 The clients argument is accepted and right..

CA Shiv

CA Shiv (Expert)
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07 February 2012 Wats the amount of the bill.. Forget it if its a small amount and charge to the year where the amount is actually paid....

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