Easy Office
LCI Learning

Accounting Treatment for waiver of loans

This query is : Resolved 

22 August 2007
Dear Experts

The query which I'm posting is related to accounting treatment for waiver of loans specifically waiver of principal amounts.

Lets say A Ltd. took a loan for financing fixed assets and later on A Ltd. turned into loss making company.

Lender i.e. financial institution waiver off certain portion of principal and interest. Now the query is what should be the accounting treatment of waiver of principal in the books of A Ltd.

rgds
hitesh

Raj (Expert)
22 August 2007 In my opinion it should treat as deffered income & credit to P/L over span of Asset-life

Raj (Expert)
23 August 2007 Hi hitesh our matching concept always demands for it. it our accounting principles set in by our institute.

*Can you say in which AS deffered revenue expenditure has mentioned ?


23 August 2007 In my opinion it should be written off and crdited to profit and loss account as etra-ordinary item



You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

CAclubindia's WhatsApp Groups Link


Similar Resolved Queries


loading


Unanswered Queries




Answer Query