Whether any Provision is required to be created for expenses relating to previous year incurred by the contractor but the bill is raised by contractor to us in the current year?
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Prior period expenses
Replies (1)
Hi Naman,
I think the provision is to be made....since the very meaning of provision says that u ve to provide for an expected future exp.....So it doesnt depent on the bill. Since u ve only said that it relates to previous year, provision has to be made....
And one more thing is it cant even be treated as a contingent Liab, since the same has already occurred..So provision is to be made...
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