Reversal of expenses

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bhoop (Querist)
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30 August 2011 Dear Experts

We had booked a Air Ticket and accounted as "Tours & Tavelling Expenses". but due to some reason we cancelled the said ticket and got the refund.

So please advise how it is accounted i.e. it is credited "Tours & Travelling Exp" or booked as an "Income"

Please also suggest which Accounting Standard is applied for this type of transactions.

Thanks
Bhoop Singh

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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30 August 2011 It is not income

need to be reversed back your Tour & travel expenses and adjusted accordingly

this is normal accounting. no need to refer any accounting standard

Only in case the reversal in different year the need to be booked as prior period items

CA. Nitin Agrawal

CA. Nitin Agrawal (Expert)
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30 August 2011 That certainly not the INCOME of company hence the same should be show as "cr" to "tour and travelling exp." account.

According to me, there is no AS specially related to that case as it comes under general accounting practices and principles. You can refer AS-9 "revenue recognition"

now cheers

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