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Treatment of pre operative & preliminary expenses

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navin oswal

student

21 Points Posted on 25 February 2014

Hello Everyone,

I have a company which was started on 01.11.2011. We have spent some money for preliminary expenses & some for pre operative expenses. No other expenses are incurred. We are planning to wind up company on 31.03.2013 by preparing Financial Statements for 15 months.

I want to know what to do with preliminary & pre operative expenses. Write off or show in non current assets & in case expenses are not written of completely what happens to balance expenses in the books since we are winding up the company -

1. Do we need to prepare Financial Statements along with Auditor's Report for all the years upto which expenses are written off completely ?

2. Do we need to file IT Return for all these years ?

3. Since this is a Voluntary winding up by members what should we write in Auditors Report. Please keep in mind that this is a first & last year of operation. ?

I need it urgent. Thank you in advance.

Replies (1)

Manoj Mehta

Head Of Department (Accounts & Finance)

1272 Points Posted on 03 March 2014

Dear Navin

Firstly Every Company must file income tax returns, Hence you have to file ITR6 for the company stating the same. Also in ROC. (for this you should prepare your financial accounts and if it is not under the liablity of Tax audit then no need for tax audit report)

Secondly for Preliminary Expenses i suggest you to writeoff the same in the last year completly by transferring the amount to profit and loss a/c.

Please confirm the date 31.03.2013 or 2014??

Regards..