writing off preliminary expenditure

This query is : Resolved

Sowmya.S.Balan

Sowmya.S.Balan (Querist)
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16 November 2010 dear sirs,
in my case a company was formed in 2002 and preliminary expenditure incurred during the year 2002 is shown under head miscellaneous expenditure for writing of in the forthcoming years. but after the introduction of AS-26 preliminary expenditure should be written off as an when incurred. whether the unadjusted amount of preliminary expenses can be completely write off in the year 2005 or it is to be written off over a period of years.yours valuable advice is expected

Selvakumar Selvaraj

Selvakumar Selvaraj (Expert)
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16 November 2010 AS 26 deals with Intangible/Research preliminary expenses. So you continue with existing Company law provisions for the company formation expenses.

Pankaj Jhawar

Pankaj Jhawar (Expert)
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16 November 2010 You may completly write off in 2005

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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17 November 2010 My understanding is the balance amount outstanding is to be written off in full since AS-26 has been notified as part of the Companies (Accounting Standards) Rules,2006 in order to comply with section 211 (3C) of the Companies Act,1956.

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