treatment of exp

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vijayabhaskarareddy (Querist)
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22 October 2008 if we bought tally software for 38000, can i account it as asset in books of accounts or as expenditure . pls forward ur advice to uvbr@rediffmail.com

S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)
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22 October 2008 Asset.

Sanjay

Sanjay (Expert)
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22 October 2008 Where the expenditure incurred on the software is likely to give an enduring benefit over a period of time, then the software has to be treated as an asset only.

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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22 October 2008 Pl see my view in reply to your earlier question on the same subject.

Reetika Goel

Reetika Goel (Expert)
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22 October 2008 A software is considered as an asset only if you get a LICENCE for the same
- to USE IT AND
- TO SELL IT TO SOME OTHER PARTY for some consideration.

If both of the conditions are not fulfilled simultaneously then the expenditure incurred on the software is considered as expenditure

For Example: The Finacle software developed/purchased by UCO Bank can be considered by the Bank as an asset because they withhold the right to sell that software as well.

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