INVESTMENT OR LOANS AND ADVANCES

593 views 2 replies

I have a question regarding the following matter.

"A" Ltd have subscribed for shares in new company "B"Ltd (as first Subscriber), now the accounting year for "B" Ltd ends on 31/03/2011, now the problem is whether the amount invested as subscriber in "A"ltd has to shown under the head of Investmentsor Loans & Advances. ]

"A" ltd argues that as we have not received share certificate we can show it as Loans & Advances while the auditor of "B" ltd says that it should be under the head of Investments.

Please guide me in the matter.

Nirali Solanki 

Replies (2)

The same should be shown under Investments in the books of Investing company & not under Loans & advances.  Because as per the basic accounting concepts "Substance over form", the transaction should be recorded even though the legality of the transaction yet to be happen

according to me it should be shown as Investment....

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
06 July 2026
Chartered Accountant (Indirect Taxation)

Gowra Ventures Pvt Ltd

Hyderabad

CA

View Details
Company
24 June 2026
Senior Account (VA Client Operations)

Karbon Business

Bengaluru

CA Inter

View Details
Company
06 July 2026
C.A./CA Inter OR pursuing C.A./GST/Accounts/Audit/IT - Head

Arvindkumar Maniar & Co.

Rajkot

CA

View Details
Company
06 July 2026
Accountant

Agarwal Anoop and Associates

Noida

CA Final

View Details
Company
25 June 2026
AUDIT MANAGER

JDAS & ASSOCIATES

New Delhi

CA

View Details
Company
22 June 2026
Accountant

Global Image Technologies Private Limited

New Delhi

MBA

View Details
Company
20 June 2026
Assistant Accounts Manager

Fintax Professionals

Gurgaon

CA Inter

View Details
Company
29 June 2026
ACCOUNTANT

SANDEEP AASHISH & CO

Araria

B.Com

View Details