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Narration of Journal entry

08 August 2021

as we know we write narration along with each journal entry
but no accounting standard or policy makes it mandatory.
What your view on this matter.
is it practically necessary to write narration?

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6 Replies

CA. Sourav Sarkar (Chartered Accountant ) (24578 Points)
Replied 08 August 2021

Not necessary but writing narration helps to quickly identify the transaction for which the journal posted

prasad Nilugal (3909 Points)
Replied 08 August 2021

It is necessary to understand to others and auditor ,why we pass journal entry. and other details , it is necessary to write narration , whether it's in law or not .

Rama chary Rachakonda (Master in Accounts & Lawyer email ID:ramachary64@gmail.com voice no:9989324294) (3293 Points)
Replied 08 August 2021

narration is necessary. It must be simple one line text.

Sudhir Kulshreshtha (Advocate) (179 Points)
Replied 09 August 2021

Not mandatory but necessary to identify the transaction.Same amount transaction confuse over a period of time and one can not remember all transactions .