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Query
If a company do not pay its employees their salary for few months and use the amount as Fixed Deposit and the company is earning interest on it.
How will it be shown in SPL?
Replies (8)
SPL?
What do you mean by SPL?
The Interest arising from the FD will be Credited to SPL (Statement of Profit And Loss). The Employees Salary would be shown as outstanding. The said Investment made in FDs cant be termed as Planned Asset as per AS - 15 Employees Benefits, cause Investment in Planned assets are made for Post Employment Benefit and not current salaries.
Sir I want to ask what is the treatment for it.
Interest on earning shall be credited to SPL
FD Shall be shown as Assets
and the Payable Salary shall be shown as Current Liabilities
Sir
Can it be shown as a deduction from employee benefit ?
No, the nature of transactions are different.
Agreed with Mr. Anand.
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