prior year expenses
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
19 January 2011
Dear sir,
we had provided for audit fees for annual audit at the end of the year. however we had failed to include out of the pocket expenses for the said year. subsequently we received bill for annual audit as well as for auditors out of the pocket expenses. now should we treat audit out of the pocket expenses as prior year expenditure? can we treat the expenditure as of the year debiting audit out of the pocket expense account treating it as part of expense of the year?
Rgds
Ganesh
we had provided for audit fees for annual audit at the end of the year. however we had failed to include out of the pocket expenses for the said year. subsequently we received bill for annual audit as well as for auditors out of the pocket expenses. now should we treat audit out of the pocket expenses as prior year expenditure? can we treat the expenditure as of the year debiting audit out of the pocket expense account treating it as part of expense of the year?
Rgds
Ganesh
19 January 2011
Yes you may do so based on materiality, as i dont think out of pocket expenses will be very material at the most not more than Rs 1 Lakh. You would have any way got some excess provisions which you may be carrying to take care of the flactuation of the expenses. :)
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