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Applicable Accounting Standards

Prithi (Student) (166 Points)

16 June 2011

Hey Guys

Can u pls tell me if a subsidiary company fails to raise the invoice as per the contractual agreement on the parent company, will it be said that it is a non compliance with AS 9 (Revenue Recognition).... If that value of unbilled portion is taken as unbilled revenue then will it still continue to be non compliance with AS 9..

Please make it fast its urgent

Thx in Advance for your help

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4 Replies

Prithi (Student) (166 Points)
Replied 16 June 2011

Pls can u give me a solution fast

ashish gupta ( student) (1922 Points)
Replied 16 June 2011

Raising invoice is not a requirement of AS-9 . If sales has actually been made you should book the revenue. But there should be a voucher in all cases to support the transaction.

CA Shahrukh khan (Assistant Manager) (72 Points)
Replied 16 June 2011

Hi..guys

it is wiithin the purview of AS-9 and we can book the revenue as Unbilled revenue and after that for our documentation & evidenice purpose on behalf of which entry is passed in the books of account should be raise as invoice on holding company.

for the purpose of AS-9 it is more important for booking the revenue that "significant risk and rewards are transfered to buyer" so if significant risk and reward trasfer to holding company than subsidiary can book the revenue.

Viren (Chartered Accountant) (137 Points)
Replied 17 June 2011

Originally posted by : Shahrukh khan
	Hi..guys it is wiithin the purview of AS-9 and we can book the revenue as Unbilled revenue and after that for our documentation & evidenice purpose on behalf of which entry is passed in the books of account should be raise as invoice on holding company. for the purpose of AS-9 it is more important for booking the revenue that "significant risk and rewards are transfered to buyer" so if significant risk and reward trasfer to holding company than subsidiary can book the revenue.