Hi,
One of my clients has a policy of maximum 40 accumulated leaves for the purpose of leave encashment, and any leaves in excess of 40 gets lapsed. The cut off date for calculating accumulated leaves is December 31.
The question is that for the purpose of Acturial Valuation for Leave Encashment as on March 31, how much max accumulated leaves should be considered. Should it be 40 leaves or 45 leaves (5 extra for first quarter)
Dear Ravneeth Singh
Since the maximum accumulated leave available is only 40, no accumulation above 40 is possible. Hence Provision for Leave encashment needs to be created only to the extent of 40 leaves since 5 of the leaves accumulated till Dec-12 would have lapsed
Gupta Sachdeva & Co. Chartered Accountants
New Delhi
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