Hello friends i need some clarification regarding verification of loans against fixed assets. Whether the WDV of Fixed assets should always be equal to or more than O/s amount in respect of loan. The problem is mainly posed due to charging of high depreciation as per IT rates. Or can we rely on the valuation certificates. If any other way please throw some light on this subject.
Hi there,
THe valuation certificate at the time of grant of loan should be your base.
There is no such rule to match the o/s balance with with the value of the asset.
But its an industry practice to do so.
Moreover periodic valuation certificates are required our firm follows a require ment of a certificate every 3 years for such loans
The value of the asset as per that certificate should be matched by the loan balance.
What all things we have to see while checking the vouchers in a bank audit? and what are foreclosure charges and inspection charges?
Sri Aurobindo Gnostic Centre of Education
New Delhi
CA
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Rahul Dang & Associates-Chartered Accountants
Pune
CA Inter
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