Urgent -depreciation under companies act 2013
This query is : Resolved
14 May 2015
My query is whether entry in books is required to be made only on 1st of April 2014 or can be made on 31st of March 2015??? due to following provision of companies act 2013.
As per schedule II i.e. transitional provisions :-
From the date this Schedule comes into effect, the carrying amount of the asset as on that date;
(ii)In case the remaining useful life is NIL: - after retaining the residual value, shall be recognized in the opening balance of retained earnings /profit or loss where the remaining useful life of an asset is nil.
As per schedule II i.e. transitional provisions :-
From the date this Schedule comes into effect, the carrying amount of the asset as on that date;
(ii)In case the remaining useful life is NIL: - after retaining the residual value, shall be recognized in the opening balance of retained earnings /profit or loss where the remaining useful life of an asset is nil.
14 May 2015
To be made on 1.4.2014.
14 May 2015
It will be shown as "depreciation & amortization" or "amount w/o" in Profit & Loss account.
14 May 2015
Can we take useful life of an asset different from those prescribed in schedule II by giving disclosure of the fact in notes to the accounts only or is there any type of other requirement.??
15 May 2015
Entry is
Reserves and surplus a/c Dr xxxxx
To Asset a/c xxxxx
(Being value of the asset
less its residual value
which has no more useful
life as on 1-4-2014 t/d
to former a/c)
Ps:- this adjustment should not be routed through p & l account.
Reserves and surplus a/c Dr xxxxx
To Asset a/c xxxxx
(Being value of the asset
less its residual value
which has no more useful
life as on 1-4-2014 t/d
to former a/c)
Ps:- this adjustment should not be routed through p & l account.
15 May 2015
Use full life can be different from that of schedule -II. If So, disclosure in the accounts is necessary by way of a note in which justification for the difference shall also be highlighted.
15 May 2015
Thanks You Sir. I have one more query
My query is If we charge depreciation on assets having nil life (due to transitional provisional of companies act 2013) to retained earnings then will it be reversed for calculation of Book Profit for MAT purpose. I mean it will be treated as depreciation for purpose of calculation of Book Profit & DTA/DTL.
My query is If we charge depreciation on assets having nil life (due to transitional provisional of companies act 2013) to retained earnings then will it be reversed for calculation of Book Profit for MAT purpose. I mean it will be treated as depreciation for purpose of calculation of Book Profit & DTA/DTL.
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