19 January 2012
My client is providing service for SAP to external clients. They are also purchasing service (SAP) from other external clients.Eg. Client is providing service for the period Dec 2011 to Nov' 2012 and they are receiving contract amount for the full period. Quetion arises whether the amount received for the months subsequent to financial year 2011-2012(i.e from April 2012 to Nov'12) should be charged as Advance received (or prereceived)?? Plz Advice...
19 January 2012
Since the amount received covers two different accounting periods the amount received shall be apportioned to both the accounting years.
Amount for 8 months from April to Nov shall be shown as advance receipt.
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