Treatment of bank balance?

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Kumar Gaurav

Going...to be C.A soon...

1055 Points Posted on 12 July 2013

Dear All

My Bank Balance is showing Rs. 100000/- on 31st March 2013 as per my books. But Actual Bank balance is Rs. 50,000/- as on 31st March as per Bank statement.

The reason for difference is that we have deposited Rs. 50000/- cheque on 31st March but not credited by bank till 31st March. ( Hence, it will reflect in BRS......but on the date of Balance sheet ie: 31st March what amount to be shown in Balance sheet is it Rs. 100000/- or Rs. 50000/-

Please advise & clear the concept.

Thanks

Replies (2)

Pakshal Shah

Practicing Chartered Accountant

242 Points Posted on 12 July 2013

It is your choice. But showing the amount in brs is suggested. Your bank account shall be 1lakh and your debtors shall be reduced by the same. At the end the net effect would remain the same. Plz guide if incorrect.

Kiara Educomp

Education

131 Points Posted on 21 July 2013

Its not about choice guys !! It has to be shown as the Bank Book Balance, as we follow tha accrual system of accounting. Receipt of cheque is shown as Increase in Bank and Reduction in debtors. Deposit or non deposit of cheque is only about realising the cheque. So, you need to show the Bank Book Balance of Rs. 100000.

Thanks & Regards

CA Vikram Kapoor

B.Com, FCA, CIA, ISA, CISA, CFE

Ex-Faculty, NIRC of ICAI (2011-12)

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