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Please answer this AS 4 related question for me.

If an entity identifies a general expense - say Rs 4000 paid to an electrician (which was omitted by mistake and which relates to previous FY) between BS date and date on which BoD approves FS, how should the entity provide for it/what should be the accounting treatment?


Kumarjit Dey

Kumarjit Dey

CA Inter

4K+

05-May-20 18:00

22

Answers (2)

Say expenditure was incurred in Feb 2020. BS date is March 31 & BOD meeting date is April 30. If it is identified on April 29th. Please change financials of FY20 and account it as current year item in FY20 and present to board. If it is identified after bod meeting date say on 1st may but before the AGM on 31st May then, if it is material disclose in directors report. If not material ignore it In FY21 book the expenses as a prior period item in that years financials.


Sriram Somayajula

Sriram Somayajula

Admin

05-May-20 18:11