Replied 27 May 2013
Im of the view that it can be shown as trade payables. Audit fees is one which incurs in "normal course of business". Here the revised sch VI doesnt say that the payment should relate to the main business or ancilliary business.
As per guidance note on Revised Schedule vi
Other current liabilites are classified as
The amounts shall be classified as:
(a) Current maturities of long-term debt;
(b) Current maturities of finance lease obligations;
(c) Interest accrued but not due on borrowings;
(d) Interest accrued and due on borrowings;
(e) Income received in advance;
(f) Unpaid dividends;
(g) Application money received for allotment of securities and due for
refund and interest accrued thereon;
(h) Unpaid matured deposits and interest accrued thereon;
(i) Unpaid matured debentures and interest accrued thereon;
(j) Other payables (specify nature).
The guidance note also says that "other payables" may be in the nature of statutory dues such as Withholding taxes, Service Tax,
VAT, Excise Duty etc.
Further the guidance note explains on trade payables as follows:
A payable shall be classified as 'trade payable' if it is in respect of amount due on account of goods purchased or services received in the normal course of business.
As per the Old Schedule VI, the term 'sundry creditors’ included amounts due in respect of goods purchased or services received or in respect of other contractual obligations
as well. Hence, amounts due under contractual obligations can no longer be included within
Trade payables. Such items may include dues payables in respect of statutory obligations like contribution to provident fund, purchase of fixed
assets, contractually reimbursable expenses, interest accrued on trade payables, etc.
Hence it can be seen that as per the institure, Other current liabilities includes only those payments like statutory obligations and other contractual obligations. Payment for any goods or services in the normal course of business can be shown under Trade payables.