Reg Notice period salary

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vanitha (Querist)
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29 December 2009 hi

Can any one suggest me how to account the following transaction.

1. i have collected notice period from the resigned employees. that means it is an income to the company. Under which head shall i account.

2. for few employess there is loss of pay on salary.. under which heading i need to book LOP.

Thanks
vanitha

Arjuna Raina

Arjuna Raina (Expert)
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29 December 2009 as i know notice period is that period in which employee lefts his job before the time of superannuation/retirement. some companies like schools have the policy that they will recover the notice amount from the employee if he leaves his employment before his date of superannuation, so this is the misc income of the company. There may be some cases that organization cannot get the notice from the employee who resigns, so this is the loss for the company.

You should as per my opinion do some steps to recover some amount.
1.If the resigned employee tells to you about the transfer of his PF account,first take the notice amount from it.
2.The best part is make the good internal control in the organization by setting up the internal control department otherwise appointing internal control consultants.