21 June 2011
One of my clients has newly started his business. Their company was incorporated in November 2010. For the year ending 31st March, 2011, no P&L A/c has been prepared as no commercial operations were started till then. So now, while filing the annual statements with ROC, is it ok if I dont file form 23ACA (P&L Statement).And also, if I am not filing form 23ACA, do i need to notify the ROC in some way that P&L A/c is not being filed as no commercial operations took place?
21 June 2011
Since your company is incorporated in November, 2010 you have to prepare the accounts up to 31st March, 2011. These account have to be audited by a chartered accountant. Now, you say that there is no activities but you have incurred preliminary expenses, you must have made payment to C.A or C.S. and no chartered accountant will certify your account without charging any fee.
Therefore, there will a loss in your profit and Loss Account. Hence, you have to file form No 23ACA. Now, from 7th July onwards if you do not file Balance Sheet and Profit & Loss Account, ROC has requested all C.As & C.S. not to sign any documents except form No. 32. This means if your company wants to take any loan from any bank the charge shall not be registered and therefore, no disbursement will be mad.
It is advisable to file 23ACA. or otherwise is is your decision to file or not.
21 June 2011
@Agarwal Sir: So sir, shall I charge all the pre operative and pre-liminary expenses(like certification fees,charges for MOA and AOA) to this year's P&L A/c?
21 June 2011
Yes otherwise in the next year all these expenses shall be prior period and under the income tax act shall not be allowed at all.
During financial year 2010-11 you show a loss. File the Balance Sheet and Audited accounts in time. The losses shall be allowed to be carried forwarded in next year.
If you do not show this year then no expenses shall be allowed as expense and your company shall be liable to pay tax
How, let me take one example say your profit for the year 2011-12 is 200 after debiting expenses of 2010-11 say 25000. Apparently on 200 tax @39%+3% shall be around Rs.62/- but infect you have to pay tax on 200+25000 = 25200 and the tax shall be 7787/- as the prior period expenses shall be disallowed. Now, it is up to you to prepare P & L, B/S and to file the same not only with the ROC but also with Income Tax Department.
C. A. S. S. AGARWAL, MUMBAI 09870243410, ssunderagarwal@gmail.com
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