Provision for audit fee

This query is : Resolved

Bhawani (Querist)
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25 May 2010 Dear sir, please tell me about the provision for audit fee at the 31 march year ending. in the company books accounts. What will be entry ?

CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)
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25 May 2010 Audit Fess A/c ......Dr Rs.10000
To Audit Fees Payable or Party A/c Rs.9000
To TDS Payable u/s 194J A/c Rs.1000

(Assuming Audit Fess of Rs. 10000/-)

CA. BIJENDER KR. BANSAL

CA. BIJENDER KR. BANSAL (Expert)
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25 May 2010 Entry will be made as like Sanjay ji explained. But TDS will be dedcuted only in case when Amount exceeds with auditors Rs. 20000.

Bimal Thacker

Bimal Thacker (Expert)
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25 May 2010 Agree with both expert. However I will suggest the following entry when TDS is matter.
Audit fees A/C .....Dr.100000
Mr X (Auditor) A/C Dr. 10000

To Audit fees Payable Cr. Rs.100000
To TDS payable Cr.Rs. 10000

Assuming Audit fees 100000 and TDS 10000

On receipt of bill of Rs. 100000 in next year entry will be as under

Audit fees payable Dr. Rs. 100000

To Mr. X ( Auditor) Rs. 100000

CA. BIJENDER KR. BANSAL

CA. BIJENDER KR. BANSAL (Expert)
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25 May 2010 No, Mr. Bimal,

Provision of any audit fees payable will be made net of TDS. Not by full amount.
We can made entry as like
Audit fee Dr. 100000
To Mr. X 90000/-
To TDS Payable 10000/-

CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)
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25 May 2010 SORRY GOT THAT EXAMPLE WRONG....IT SHOULD BE AS SUGGESTED BY MR. BANSAL......TDS TO BE DEDUCTED ONLY WHEN IT EXCEEDS THRESHOLD LIMIT (I.E. RS.20000/-). THANKS BANSAL JI FOR CORRECTION.

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