Provision for doubtful debts

shakuntala chhangani M'am..

I got confused PARA 7 of AS 29.. It is reproduced here under

7. This Statement defines provisions as liabilities which can bemeasured
only by using a substantial degree of estimation. The term‘provision’ is also
used in the context of items such as depreciation, impairment of assets and
doubtful debts: these are adjustments to the carrying amounts of assets and
are not addressed in this Statement.

 

So, Will AS29 apply to Provision for doubtful debts???

My dear, u r dealing with provision part and we are discussing contingent items.

Kartik provisiosn for debts is dealt with AS 4

Accounting to me, it is a matter of prudence that is conservatism which is the fundamental for accounting....Account for all anticipated losses... When it comes to AS 29 as said by the respective members, the answer is wrong. Because, as per the definitions of AS 29, provision is a liability. And coming to the definition of liability, liability is a present obligation arising from past events where it is expected that the probable future economic benefits will flow out of the Enterprise..Hence, the treatment does not get covered under the AS 29. KINDLY LET ME KNOW IF I AM WROÑG OR IF U HAVE ANY DIFFERENT OPINION