Holding company

Are you asking about Dividend Received by Subsidiary or Dividend Declared by Subsidiary company?

In case of Dividend Received AS 9 permit the recognition only when right to receive dividend arise i.e. when declared in AGM. Hence Dividend of last year (Say FY 2013-14) should be surrendered as income only in the FY 2014-15 after declaration thereof in the AGM of Paying Company.

In case of dividend declared

AS 4 required making provision for proposed dividend hence practically you are right that dividend proposed in last year (which is declared in current year) may had already been provided in last year P&L. But in question it is generally assumed that expense in P&L is charged only when liability to pay has arise i.e. declaration in AGM

Yes I got it.

It is the assumption that the charge on p&l is made this yr.

Thnx .