12 June 2010
CARO - While determining cash losses incurred during the year whether the provisions made towards the followings should be adjusted to the profit and loss a/c - Leave encashment - gratuity - bonus - income tax etc.
12 June 2010
In order to determine the figure of cash loss for the financial year, the figure of profit/loss shown by the profit and loss account is adjusted for the effects of transactions of a non-cash nature such as depreciation, amortisation, deferred tax expenses, etc.
So it is to be adjusted for provision for leave encashment & gratuity if the same are a non funded one.