CAclubindia

S.Srinivasaraghavan's Expert Profile

Queries Replied : 3560

About me

I am a Chartered Accountant, Cost Accountant and a Company Secretary.

I am attached to Amalgamations group of Chennai. I am also on the Board of some of their group companies, besides being a CFO & CS of Simpson and Company Ltd..

Interested in Carnatic Music, Deep reading of Science and Spiritual books and reconciling scientific truths with spiritual experiences, Travel, Games like tennis, cards etc., Watching documentaries on Animal plannet, Discovery, National geographic etc., Internet browsing - websites of Wikipedia, Nature, Astronomy and Professional forums.

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Sandeep says : audit
Dear Sir Can you elaborate , how to apportion pre operative exp to Fixed assets . What about depreciation? It will be on original Assets value or Inclusive of Preportionate Pre operative exp. =============================== Original query A trading company was incorporated on 1.4.2005 with prelims exp of Rs 30000/=. For year ended on 31.3.2007 pre operative exp as under :- 1> Salry 30000 2> Travelling 55000 3> misc exp 15000 Fixed assets- Computer 60000, Furniture 20000, Office block 300000 company statrted trading business on 1.4.2007. Please advice , how to ammortise or capitalise pre op exp Rs 100000/= Expert : S.Srinivasaraghavan Posted On : 9/17/2008 9:24:26 AM Rate This Expert Preoperative expenditure related to preparing the company to establish itself can be capitalised on a logical basis including the ratio of acquisition cost.

DINESH K SHAH says : DEPRECIATION ON REVALUATION RESERVE
FOR PLANT & MACHINERY & BUILDING IS REVALUED AND CRADITED THE DIFFERENCE AS REVALUATION RESERVE IN THE BALANCE SHEET. NEXT YEAR WHEN DEPRECIATION IS CHARGED ON ASSETS HOW THIS IS TO BE TREATED? (1) TOTAL DEPRECIATION TO BE CHARGED TO P&L A/C ON NEW VALUE OR (2) THIS IS TO BE DIVIDE IN TWO (A) ACTUAL DEPRECIATION TO BE CHARGED TO P&L a/C AND ON THE RE VALUATION DEPRECIATION TO BE REDUCED FROM THE REVALUATION RESERVE EVERY YEAR AS PER THE % OF THE EACH ASSET. PLS CNFM AS PER IFRS (INTERNATIONAL FINANCIAL REPORTING STANDARDS) Option No 2. is Correct. Both As per Indian GAAP And IFRS - THIS IS THE REPLY RECEIVED FROM 2/3 EXPERS. FOLLOWING COMMENT GIVEN BY BY ONE OF OUR FINANCE MANAGER. PLS COMMENT. AS 6 – Depreciation Accounting of ICAI has been revised W.E.F 1-4-2008 with the objective of aligning the Indian GAAP with IFRS. And as far as IFRS is concerned depreciation on revalued assets should be charged to P&L. For your kind reference a publication by Ernst & Young is attached; please go through section 4.7 in Page 29.Other wise you can go to IASB website for official pronouncement. Often this CA CLUB INDIA provides wrong advises as there is obligation on their part

CHEZHIYAN says : please solve this
http://www.caclubindia.com/experts/experts_message_display.asp?group_id=74571

CHEZHIYAN says : Non Profit Organisation
Ok but tell me can i consider this capital expenditure for 85% of Expenditure for tax benefit

S.Srinivasaraghavan says : Scrap value
Dear Mr. Praveen pandit, Scrap is valued at market price, if it is saleable and at nil if it does not have a market.