Treatment of Overvaluation of Investment
This query is : Resolved
09 September 2009
Hellow,
In the case of proprietor Invst in MF has been showing overvaluation for last 3 years and I want to rectify same this year.
How shall I proceed,
1)Shall show it as a loss is there any problem?
2) Shall I debit it proprietors capital account?
3) Pls guide me if any other method which is safer for the client.
In the case of proprietor Invst in MF has been showing overvaluation for last 3 years and I want to rectify same this year.
How shall I proceed,
1)Shall show it as a loss is there any problem?
2) Shall I debit it proprietors capital account?
3) Pls guide me if any other method which is safer for the client.
18 September 2009
CASE 1. Overvaluation means presentvalue or NAV is less than the investment made or
CASE 2. due to any other reasons ?
CASE 1
Mutual Funds are shown at cost. If you exactly want to do something you may
DISCLOSE AS -Investment in Mutual Funds (at cost) (write ORIGINAL amount)
CASE-2; If out of the pool sum mutual funds have been sold at loss earlier and the amt of loss is thus accumulated over there- It is possible when realisation is credited but the corresponding loss was not tfd to Capital. Action 2 is appropriate in this case.
CASE 2. due to any other reasons ?
CASE 1
Mutual Funds are shown at cost. If you exactly want to do something you may
DISCLOSE AS -Investment in Mutual Funds (at cost) (write ORIGINAL amount)
CASE-2; If out of the pool sum mutual funds have been sold at loss earlier and the amt of loss is thus accumulated over there- It is possible when realisation is credited but the corresponding loss was not tfd to Capital. Action 2 is appropriate in this case.
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