Rev sch vi-prelimnary exps

Preliminary expenss should not be shown anywhere in the revised schedule. It should be written off in the year in which it is incurred.

In Revised Schedule,order of authority has been given 1stly to AS,then co law and then Rev. Sch VI. It means first we have to refer to AS for the treatment and AS 26 says Misc. exp (including preliminary expesnse) are not assets and hence it should not be shown as assets.

However for academics or examination purpose it may be shown under Non Current assets.

Still In reality(practical life) if there is any pre exp standing in the books, then as a auditor you should recommend your client to writ it off.

It should be written off from opening balance of P & L A/c (referring to the provisons of As-26)…

Deducted from Surplus.