Accounting of expenses

we are providing construction service,  accidently one of our project got stay order from high court, for this case director are frequently travelling to visit advocate & also appear in high court

my question is that travelling expenses can i accounted in legal charges  

Replies (5)
No... travelling expenses here should not be accounted in legal charges but as 'Travelling expenses' only..
Alternatively you may accounted the head as legal expenses not legal charges

Travlling will not be accounted as a legale charges.

Dont complicate things. In the legal expenses head only debit those expenses which are professional charges wherein you will deduct tds and client will pay service tax if applicable. Travelling and other reimbursements put them in travelling expense or reimbursement account respectively and can link them to the legal charges via narration or an entry comment.

If you want to recover this expenditure from your vendor... then you can account it as travelling exependiture a/c and pass a JV to the vendor account...  you cannot book this expenses as legal charges.. if you book this as legal charges it attract TDS and then supporting bill will not match with your accounting policy.

 

Krishnaprasad.mb

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