What is the entry for lfy out standing liabilities not paid

Post an write-back entry as follows:

Audit Fees Payable   Dr     15000

To- audit Fees written-back A/c           15000

Why is the auditor refusing to take the amount

Reverse entry! When you made the provision, entry must have been:

Audit Fees A/c... Dr.

     To Audit Fees Payable

Now it will be just the reverse in this year-

Audit Fees Payable A/c... Dr.

     To Audit Fees

To show a more better presentation of accounts, the account Audit Fees written back can be used.  hence the said account is being credited whihc should be shown to the credit side of P&L account.

Originally posted by : Giridhar S Karandikar
	Post an write-back entry as follows: Audit Fees Payable   Dr     15000 To- audit Fees written-back A/c           15000 Why is the auditor refusing to take the amount

WHAT SHOULD I TAKE UNDERGROUP FOR AUDIT FEE WRITTEN BACK
 

Originally posted by : Giridhar S Karandikar
	Post an write-back entry as follows: Audit Fees Payable   Dr     15000 To- audit Fees written-back A/c           15000 Why is the auditor refusing to take the amount

WHAT SHOULD I TAKE UNDERGROUP FOR AUDIT FEE WRITTEN BACK
 

yes...

REVERSE ENTRY PASSED.

ON DUE :-          AUDIT FEES A/C -----DR

                                            AUDIT FEES PAYABLE

ON CANCELLATION:-               AUDIT FEES PAYABLE A/C ----DR

                                                                                 TO AUDIT FEES

It should be taken under Indirect Incomes.

If the entry is simply reversed than it would dilute the disclosure of correct audit expenditure for the current year which in turn is the specific disclosure requirements of the schedule VI of companies act.

Further, as per standard accounting practices, any liability which is no more payable should be booked to current year income rather than reducing the expenses of the prior period.

Thus, it should be written back to P&L in Audit fees Payable written back a/c.

I agree with Hari Wadhwa in the above post.

However, how should such gifts be disclosed in the Financial Statements when reporting?