Preliminary expenses shown in balance sheet

Others 1642 views 2 replies

pawan

CA FINAL

41 Points Joined August 2011

Hello guys,

I have a query in repect of prelimiary expenses shown in balance sheet.So, i would like to share the matter briefly as follows :-

1. One of our client has adopted AS -26 for Prelimiary epxenses & shown the same in Statement of profit & loss.But, they shown directly as quoted " prelimiary expenses " in statement of Profit & loss.

2.as per my view, it should be shown in Other expenses & then directly shown the same in statement of profit & loss through link from note No..

3.My Client is disagree & their contention that the schedule III is silent on it.so, we could disclose the same in preliminary expenses without quoting the Note no.

So, Kindly provide your valueble comments on aforementioned topic & resolve the same at earliest.

Replies (2)

Saliq Ansari

CA_Final Student

885 Points Joined January 2010

The format of SPL in the schedule III is to be followed by every company, A company is allowed to insert any line item in the provided format but it cannot delete one that is given in Sch III.

There is no harm in extra disclosure, I think company can do so.

But also wait for experts comments on these.

pawan

CA FINAL

41 Points Joined August 2011

I have just read the general instructions as stated in Schedule III as Follows :-

(ii) Each item on the face of the Balance Sheet and Statement of Profit and Loss shall

be cross-referenced to any related information in the notes to accounts. In preparing the

Financial Statements including the notes to accounts, a balance shall be maintained between providing excessive detail that may not assist users of financial statements and not providing important information as a result of too much aggregation