Dear Forum members, I have queru regarding classification of loans, please consider the following information:
ABC Ltd. took a Term Loan(say Car Loan) which is repayable over a period of 4 years.The Auditor is asking to classify the said loan in Long Term and Short Term in the following manner:
As per the Auditor the EMIs which are due for hte payment within 1 yr. of Balance Sheet date should be shown as Short term loan and the remaining part in Long Term ......Please suggest wheather the auditor is justifed in the treatment of said term loan as such?
Your early response will be highly appreciated ......
Regards,
Saurabh
CAclubindia
