Depriciation to be charged or not in this case

Dear all,

I have noticed that in last year balance sheet no depriciation is charged on the fixed assets. Account is already audited by CA. Notes are given in the balancesheet for the difference in depriciation as per IT act and company act. We have started business in mid 2012, up to now we are building our product and not generated any revenue . Last year all expenses taken as WIP and same will be done this year too. So please explain whether to charge depriciation this year or not

Replies (1)

Dear Jitender

Concept of Depriciation start when your asset is ready to use. (Put to use) so depriciation will be charged on these assets only when they are tranferred to asset a/c and not on WIP. I hope answer will solve your querry or you can put a pm to me. 

Regards 

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