Ad-Free CAclubindia and Daily Updates on your mobile. Subscribe Now!

Cash withdrawn in foreign currency for foreign travel

KAILASH A. DANGADE (ACCOUNTS & FINANCE MANAGER) (121 Points)

01 November 2012

Hello All,

Organization withdrawn cash 1000 GBP from his EEFC GBP A/c for Foreign Tour Cash Exp.

Director finishes the tour & submitted cash Exp. but not submitted some of bills like local traveling & local Foods.

Can we put the expenses in accounts?

Can we put Exp. General Day basis allowance system, like 5 GBP for Foods for a day or 10 GBP for Local Travel Allowance?

Write us you’re Views on this.

Thanks

Kailash Dangade

Accounts Manager

Reply
Follow
Share

5 Replies

(Guest)

Supporting for any tipe of expenses made is nessesary whereever possible, auditor may raise the queries for the proof of the expenses.

Upgrade to CAclubindia Pro. Subscribe Now!

(Guest)

This where the concept of materiality arises. The Auditor may or maynot consider the lack of bills based on the materiality and risk.

As you asked perdiem for food and other expenses can be allowed if it is there in the travel policy of the said company.

Venkateswara Rao Sapare (Accountant) (1500 Points)
Replied 01 November 2012

Valid supportings are required. If supportings are void, the said expenses are not allowed.

(Guest)

Sometimes for local travel bills may not be available and no bills for food if purchased from street stalls..

In such cases, if the Company has travel policy or accomodation policy, the above expenses shall not exceed the prescribed limits.

Director shall prepare a signed statement regarding the expenses during foreign trip along with all available supportings and get sanctioned by the Managing Director or Executive Director or Board of Directors or Chairman of the Board.

In my opinion, the above may be enough.

Venkateswara Rao Sapare (Accountant) (1500 Points)
Replied 01 November 2012

Dear Friends

Who will frame the policy? It is not framed according to our requirements.

We are given this impression that it will be accepted, as long as it does not come to the notice of Revenue.

Has Revenue ever told us so? Please, help me to understand.

I also request you to read following section from the Companies Act, 1956

9. ACT TO OVERRIDE MEMORANDUM, ARTICLES, ETC

Save as otherwise expressly provided in the Act -

(a) the provisions of this Act shall have effect notwithstanding anything to the contrary contained in the memorandum or articles of a company, or in any agreement executed by it, or in any resolution passed by the company in general meeting or by its Board of directors, whether the same be registered, executed or passed, as the case may be, before or after the commencement of this Act ; and

(b) any provision contained in the memorandum, articles, agreement or resolution aforesaid shall, to the extent to which it is repugnant to the provisions of this Act, become or be void, as the case may be.

1 Like

Upgrade to CAclubindia Pro. Subscribe Now!