11 December 2007
Actually a partnership firm can not be 'converted' to a company in the real sense.But it can be registered as a company under the companies Act following the procedure mentioned therein. Refer Section 568 Chapter IX of the companies Act
12 December 2007
As told by Mr Srinivasaraghavan its true that partnership firm cannot be converted into a company in real sense however it can be converted to a company in accounting sense.Procedure is as follws: Form a new company and calculate the purchase consideration of the firm and the ratio of the capital balances of the partners.Shares of the new company can be issued in above ratio and then the assets and liabilities will appear in the books of the company.Refer to institute studies of advanced accounts for detailes accounting entries.
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