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Processing Charges

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(Querist)
10 August 2010 My Query:-

Can Processing charges on Loan taken be deffered over the period of loan? Does any Accounting Standard or Accounting principal/policy support the view?

Thanks & Regards

Piyush
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Aditya Maheshwari

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Aditya Maheshwari (Expert)
10 August 2010 Processing charges are written off in the year in which they are incurred. If they are capitalised as per AS - 16 borrowing cost then deprecaition on the same is allowable.
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Piyush Newar

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Piyush Newar (Querist)
10 August 2010 Dear Aditya,

Deferring and Capitalizing are two seperate issues..
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Piyush Newar

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Piyush Newar (Querist)
10 August 2010 I want to know if this can be deferred??
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CMA. CS. Sanjay Gupta

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CMA. CS. Sanjay Gupta (Expert)
10 August 2010 No Processing charges on loan can not be deferred and should be written off in the year in which they are incurred.
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Aditya Maheshwari

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Aditya Maheshwari (Expert)
11 August 2010 It cannot be deferred as is mentioned in the reply above also.

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