Lease hold land of 99 year.

the land has to be amortised.but in books leasehold land is shown as historical cost and amortisation is credited to accumulated depreciation

Thanks for reply...

can u please explain me under which AS or Law we can amortised the lease hold land and It there any way to justify to client regarding the same.

Read AS-10  Accounting for Fixed Assets and also AS28 on Impairment of Assets

hi Sivaram

As per my understanding there is nothing has been given in the AS 10 and AS 28 regarding the Amortisation of Lease hold land. If u have any specific Details ragarding the same please share with us.

Thanks.

 Its not mentioned in the Accoutni9ng Standard. However, the industry practise is to amortise it over a period of 99 years while the amoiunt has to be shown in accumulated depre. accounts as pointed out by Sivaram...

What if the company is not amorised it in ealrier year.

There should be some vaild point to discuss with the client and also need some rules to support the same.

I m already aware that we need to amortised it but under which law or rule we have to do it. What if someone is not ready to follow the same ?

Regards,

CA Amit Goyal

Hello! I have come accross this case while auditing and really need help!!

There is this firm which has taken a land on lease from government and for which it has to make 10 semi annual payments. It has already made 4 payments. The lease deed was executed in 2008. How will we show this in our books?can we capitalize it despite the fact the the entire payment can be made?how much can we capitalize, the entire amount payable or the amount actually paid?

also how wil we amortize?should the entire amount payable be amortized every year for 90 years or the amount paid?

please help!!