Treatment of pre operative expenses.

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sriram (Querist)
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27 September 2011 dear members,
what is the acoounting treatment for preoperative expenses in the case of amalgamation in the books of amalgamated company which is already existed in the amalgamating company.can that expenses be carry forward by that new company & to be write off wholly in it's books or not?

CA Pushpendra Gaur

CA Pushpendra Gaur (Expert)
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28 September 2011 Pre-operative expenses are to be written off in the books of previous company itself

CA Pushpendra Gaur

CA Pushpendra Gaur (Expert)
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28 September 2011 Both the methods of amalgation doesn't speak about carrying forward of such expenditure

CA Pushpendra Gaur

CA Pushpendra Gaur (Expert)
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28 September 2011 The pre-operative expenditure must be transferred to Share Capital A/c

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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28 January 2012 No it is to be treated as deferred revenue expenses and to be written off in 5 equal installments

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