Dear Experts and Friends,
An issue arose when I audited a company's books.
The company was not remitting Sales Tax, EPF and ESI and the books remained un-audited for some years.The amount payable under the above were quantified and been accounted for. When the first un-audited year was brought to audit, claims of the above departments of the amount due, interest thereon and penalty were brought to my notice. The company's appeal against those were set aside and the amount payable as interest and penalty were confirmed. Are the interest and penalty adjustable in the accounts of the year to which those pertains, considering AS 4 ?
I am in a view that those are adjustable, as though in the year to which it pertains it is not quantified, it is quantifiable relying upon the provisions of the said laws on interest and penalty.
CAclubindia
