09 September 2011
Sir A pvt ltd company has increased its paid up capital by debiting allottee a/c and crediting share capital a/c. the entry was made on 31.03.2011 but the cheaque is not cleared in the bank. the company has also filed form 2. My question is can a company show the increased share capital in its balance sheet as on 31.03.2011 .
09 September 2011
No, don't think so, cheque may bounce and paid-up capital would become deficient to that extent. Further on bank reco. it will appear as cheque deposited but not cleared. To meet out the contingency it should have been indicated with full disclosure and note to the BS
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