28 April 2010
I M WORKING IN A PSU.RIGHT NOW THERE IS A BILL TO BE PROPOSED REGARDING GRATUITY PAYMENT HIKE UPTO 10LAKHS.SO HOW WE HAVE TO PROVIDE IN BOOKS OF ACCOUNTS WITHOUT EFFECTING PROFIT FIGURE..LIABILTY WILL BE AROUND 100 CRORES TO BE PROVIDED IN THE BOOKS OF ACCOUNTS..PLS SUGGEST ME THE TREATMENT.
It is not clear from your Q how you have derived at 100 Crore.
In my opinion first you go to some actuary & provide him following details Employee Name, Date of birth, Date of joining & his basic salary. Then he will calculate for you what is your gartuity liability.
If you are providing for gratuity first time in your books, the opening liability can be adjusted against your reserves & hence it will not impact your current year profitability.
CAclubindia
