As per the concept of conservatism expected losses are to be considered and expected profits are to be ignored but as per AS 29 profits which are certain to get are to be considered?
whether this make any difference? if there what it may be...?
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provision
Replies (2)
yes you need to provide for all losses that organization thinks may materialize in order to know the true profitability of business.
also profits that are certain need to accounted ad per accrual concept.
else you wud not be able to analyze the profitability properly
also profits that are certain need to accounted ad per accrual concept.
else you wud not be able to analyze the profitability properly
as per conservatism profits are estimated, but it's uncertain in future. that's why we are not considering.
whereas as per AS 29, asset we are recongnising only when we got certainity in collection of income.
whereas as per AS 29, asset we are recongnising only when we got certainity in collection of income.
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