11 June 2010
Should the payment to statutory auditors for audit fees be inclusive of Service tax or exclusive of service? What if the company does not claim the CENVAT credit on service tax and charges it to expenses?
13 June 2010
In notes to accounts, the company should show either payment to auditor(including service tax) or (excluding service tax). But if the company does not claim the cenvat credit on service tax and charges it to expenses that does not affect disclosure in notes to accounts. The reason is that the company should show the payment to statutory auditors in notes to accounts. The service tax is charged in bill by stautory auditor due to his statutory obligation to charge the same as per rules of service tax applicable to the extent. Here it is right of management to show payment to statutory auditors including service tax or excluding service tax.
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