Revalation of Investment

Wierd Question I am not getting the concept at all...
Company is a seperate legal entity.
Company B is in Profit
Company A is making loss
A has invested in shares of B
And now A wants to revalue shares?
Fixed Assets include Inventory
very vague really vague
Is that your Q or u picked it from somewhere??

sorry I have not write down the both companies are sister concern loss making (A) has made investment in its sister concern (B) which is profit making when I calculate the net worth of the comapny (B) ITS FAIR VALUE OF SHARES IS GOOD then I have revised the value of Investment in the Company A this only I have doing to wipe off large profits in Company A also not to Increase the taxabl profits of the company I literlly want to way out I U have any other option regarding my querry then please mail instantly  

[quote=Guest user (Guest)]sorry I have not write down the both companies are sister concern loss making (A) has made investment in its sister concern (B) which is profit making when I calculate the net worth of the comapny (B) ITS FAIR VALUE OF SHARES IS GOOD then I have revised the value of Investment in the Company A this only I have doing to wipe off large profits in Company A also not to Increase the taxabl profits of the company I literlly want to way out I U have any other option regarding my querry then please mail instantly Also Company has purchased some fixed assets in last previous year but wrongly it has been included in inventories is there any solution that we can rectify this mistake also [/quote]

See this is a long term invesst and you have to value it as per AS 13 -ie at cost and i dont think you can revalue it upwards.
       Secondly this will be a notional valn and hence without any tax consequences and tax consequences will be there only on actual sale and actual profit.
        If you revalue ,then deferred tax consequences will be there as per AS 22.

Normally, long-term investments such as these, are stated at acquisition cost only. revaluation can be made only if the change in value is long term. even if u do revalue it upwards....u will have to create a revaluation reserve, which, as far as i know, cannot be set off against debit balance in the P/L account.

Thanks SC

this is a long term invesst and you have to value it as per AS 13 -ie at cost and i dont think you can revalue it upwards.
      Secondly this will be a notional valn and hence without any tax consequences and tax consequences will be there only on actual sale and actual profit.
       If you revalue ,then deferred tax consequences will be there as per AS 22.