20 June 2008
Our firm has revalued the fixed assets as on 31.03.2007. The amount of revaluation was tranferred to partners capital. The said firm was converted into company under part IX of companies act as on 01.05.2007. The auditor of company wants to show the amount of revaluation in the notes of companies books of account. My query is whether the auditor is correct in showing the amount of revaluation by creating the revaluation account and reducing the amount of partners capital.
20 June 2008
yes the auditor is absolutely correct. As per AS-10-Accounting for FIXED ASSETS, If a asset is revalued upwards then the amount should be credited to a separate revaluation a/c. and should be shown under reserves and surpluses
CAclubindia
