This is with respect to a client. The client has shown rental income in relation to a property occupied by X Ltd. X Ltd is unable to pay rent and hence the client has asked them to vacate the property May end. But rental income has been shown for the year 2017-18 , which has not been received. Security deposit given has already been adjusted , still money is receivable from the party, which he is not going to pay.
How do i treat this during the audit? Should rental income be reversed to such extent?
CAclubindia
