preliminary expense

Others 676 views 2 replies

A Firm Was converted into Company In The Previous Year 2007-08.

Till 31.12.2007 it was a firm after that it was converted into a Private limited comany.

Now My Doubt is that, the expense incurred by the firm to convert itself into a company can be called as preliminary expense or not.

If Yes why,if reply is no please explain it.

Replies (2)

As it is preincorporation expenses of the company the same will be treated as preliminary expenses.

Any expense incurred for formation of a company whether by conversion or a new formation is  treated as pre-operative expenses.


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