PRIOR PERIOD EXPENSES

HELLO||||||||||||||||

MAY I KNOW THE MEANING OF PRIOR PERIOD EXPENSES ?

AS PER SEC.36 THEY HAVE TO BE DISALLOWED.MY QUESTION IS I HAVE INCURRED SOME EXPENSES ON THE LAST DAY OF FY I.E., 31.03.09., BUT I HAVE RECEIVED THE BILLS FOR THE SAME IN THE MONTH OF APRIL'09 & MADE PAYMENT IN THE SAME MONTH. SO WHILE AUDITING WHETHER WE HAVE TO MAKE A NOTE OF ALL EXPENSES WHICH ARE INCURRED IN MARCH'09 & WHERE BILL RECEIVED  & PAYMENT MADE IN APRIL'09.? HAVING NOTED ALL THOSE WHETHER I HAVE TO MAKE PROVISION AT THE TIME OF FINALIZING THE ACCOUNTS FOR 31.03.09 AH?

Replies (1)

you have to make provision for expenses on 31st March itself, even if you have not received the bill you can make to provision in books of accounts. so in next year you don't need to debit the expenses in prior period expenses.

 

:-)

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