valuation of land and bulding

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Querist : Anonymous

Querist : Anonymous (Querist)

30 October 2010 I am doing first time audit of a Tample trust. how should I value land and bulding trust.

1. Land is bought 70-80 years ago and now trust has no documents of purchase. I have got a B-1 Khasra copy of government record which shows only ownership of land. but no documents avalable related to cast of purchase. whether I can value it at current value for the purpose of stamp duty valuation authority.

2. building also built 25 years ago now trust has no records related to cost. how can I estimate it.

3 Can you provide me mandir trust audit format.

CA Shailesh Kumar Bhagat

CA Shailesh Kumar Bhagat (Expert)
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30 October 2010 You are a auditor of the trust, this is not your job to make valuation or extimation of property.

If , there is no record of land , means somebody might have donated to temple, in the same way bulding might have constructed by people support.

In this case you make take the nominal value of land and building i.e. Rs 1.

Querist : Anonymous

Querist : Anonymous (Querist)

30 October 2010 It is not donated ,

Querist : Anonymous

Querist : Anonymous (Querist)

30 October 2010 it has been bought at about1000- 2000 according to trustee , bulding also constructed by trust by trust fund ans donation ......... but trust started maintaining accounts 3 years before.

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)
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02 August 2025 Valuation of Land and Building for Temple Trust Audit — Key Points and Suggestions:

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### 1. **Valuation of Land (No Purchase Documents, Old Acquisition)**

* Since land was purchased 70-80 years ago and no purchase documents are available, and only **B-1 Khasra extract** is available showing ownership:

* **For audit and accounting purpose:**
It is common practice to **value land at a nominal amount** if no cost records exist, especially for very old acquisitions.
* **For reporting or fair presentation (if required):**
You may consider **current market value** based on **stamp duty valuation authority** or **registered sale deeds of similar nearby lands** as a reference.
* **Disclosure:**
Disclose in notes to accounts that the valuation is based on current market rates or nominal value due to lack of original cost records.

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### 2. **Valuation of Building (Constructed 25 years ago, no cost records)**

* Since building was constructed 25 years ago and no records of cost are available:

* You can estimate **depreciated replacement cost** — i.e., approximate current cost to construct such a building minus depreciation for age and wear.
* Alternatively, if estimation is difficult, use a **nominal value** (e.g., Rs. 1 or a token figure) and disclose the reason in the audit report.
* Consult **local builders/valuers** or use average construction cost per sq. ft. in the area to arrive at approximate cost.

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### 3. **Mandir Trust Audit Format**

* Audit formats vary but generally include:

* **Balance Sheet** showing assets (including land and building), liabilities, and funds.
* **Receipts and Payments Account**
* **Income and Expenditure Account**
* Notes on accounts and disclosures as per Trust Act and applicable accounting standards.
* You can request sample trust audit formats from:

* Institute of Chartered Accountants of India (ICAI)
* Local government trust registrar office
* Online resources or professional forums

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### Additional Suggestions:

* **Clarify the ownership** of assets in trust books clearly, mentioning limitations due to missing original documents.
* Ensure **adequate disclosures** regarding valuation methodology and any assumptions.
* If possible, get a **professional valuation report** from a registered valuer for fair presentation.
* Maintain good documentation for future audits.

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Would you like me to draft a sample audit note or valuation disclosure for your report?

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