recognising deferred tax asset for the first time in account
This query is : Resolved
07 August 2009
a company in earlier has disclosed by way of a note its deferred tax asset figure, but this it is bringing that very figure into accounts only by adding the same with general reserve and with corresponding debit. is their treatment is right?
07 August 2009
Recognising Deffered Tax Asset is a very serious accounting step taken by the company.
Being the auditor of the company you should have sufficient material evidence that the Asset will be reversed during the next few years. If the same is not there then you should not allow them to recognise the Deferred Tax Asset.
The Deferred Tax Asset will be credited to the P&L A/c and correspondingly will be shown separately below Investments and above Current Assets in the Asset side of the Balance Sheet.
In the notes to Accounts the basis of its calcultaion should be disclosed.
Being the auditor of the company you should have sufficient material evidence that the Asset will be reversed during the next few years. If the same is not there then you should not allow them to recognise the Deferred Tax Asset.
The Deferred Tax Asset will be credited to the P&L A/c and correspondingly will be shown separately below Investments and above Current Assets in the Asset side of the Balance Sheet.
In the notes to Accounts the basis of its calcultaion should be disclosed.
07 August 2009
agree with Mr. Abhishek.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Is this income indian or foreign income?
- REGARDING GST ON COMMERICIAL PROPERTY
- 15ca /15cb whose income tax login? remitter or nri seller's login?
- TDS U/S. 194NF
- ITC temporary reversal and reclaim
- RCM applicability on Rent Paid by Registered Person to Unregistered Landlord for Residental Building
- GST on export of services and Input Credit
- Regarding Documentation & Compliances for Opening of Unit of Pvt Ltd.
- Applicable TDS rate for sale of property in Nov 2024
- REGARDING 25 AS DATE OF PAYMENT AND DATE OF BOOKING
- MIS MATCH OF INVOICE NUMBER
- VERIFICATION OF REFUND RELATED
- GST Regis.
- ITC c/f from FY2022-23 to FY2023-24 entered the same in table 8C of GSTR9 of FY 2022-23, in FY23-24
- Late filling fees Demand by gst office
- IGST Credit-Show cause notice issued-confusion
- Short and Excess provision of expenses
- Issue of gst e invoice
- Interchangeable words in accounts
- Adjusted profit/Loss in the case of LLP and Pvt. Ltd.company
Trending Online Classes
CAclubindia
