Preliminary expenses

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

16 July 2012 what is the treatment of preliminary expenses in accounts?

whthr it will come in
asset side of balance sheet

or

directly charge to p/l a/c

as per revised schedule 6

CA RICHA BADALIA

CA RICHA BADALIA (Expert)
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16 July 2012 Charge it fully to P/L.

Querist : Anonymous

Querist : Anonymous (Querist)

16 July 2012 can u gv me logic behind this?why cnt i show it as other current asset

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CA RICHA BADALIA

CA RICHA BADALIA (Expert)
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16 July 2012 Sir,
Refer As-26 on Intangible Assets.As per AS- 26 it does not meet the definition of asset.You cannot amortise it and show the balance in current asset.It should be expensed in the year of incurrence.