Dear friends,
Please help me on the following query:-
X a private limited company has declared & paid an interim dividend
in July 2005.The company closes its books on 31st March every year.
While distributing the dividend the company has opened a bank account
in the name of interim dividend account 2004-05.
The Company wants to provide for this interim dividend in its books
for 2004-05.
Will it be in order for the Company to provide for the interim
dividend for 2004-05 or should it postpone it and account for it in
2005-06?
Kindly advise.
Regards,
S.Sankaran
Hi Sankaran,
I hope this helps. But pls. try & confirm it before you use it.
"There are events which, although take place after the balance sheet date, are sometimes reflected in the financial statements because of statutory requirements or because of their special nature. Such items include the amount of dividend proposed or declared by the enterprise after the balance sheet date in respect of the period covered by the financial statements. Thus, dividends which are proposed or declared by the enterprise after the balance sheet date but before approval of the financial statements, should be adjusted as per para 14 of AS 4."
Lucy
CAclubindia
