20 November 2007
Can we credit the mat credit in the P&L a/c as per AS 22.Please give the detail of AS 22 & any other guidance note on MAT credit.My doubt regarding entry of MAT CREDIT when we can't book the future profit as per prudent concept then why we are making entry of MAT credit.
20 November 2007
Pl.read the Accounting Standard Interpretaion 6 for this matter.As per AS 22,prudent concept cannot be ignored while making entry for MAT credit.If there is a certainity (specifically virtual certainity is required)for future set off,then only future profit could be considered.
In other words,if the company has unabsorbed depreciation loss or other lossess which are allowable as per Income tax records then only it can pass the entry for MAT credit.
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