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Clarity required on prior period items under as5

Sandeep Koonaparaju (Partner) (39 Points)

11 September 2018

Dear Freinds,

I have a question on AS 5 .

In 17-18 we decided to issue debit note to one of our customers towards interest for non payment. A majority of this interest is related to FY 16-17. The debit note was issued in June 17 before finalizing accounts for FY 16-17.

Should the interest pertaining to the period FY 16-17 be disclosed as prior period item?

Thanks

Sandeep

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1 Replies

Rohit Tibrewal (Student & Senior Accountant) (3193 Points)
Replied 11 September 2018

Interest of non payment for the period?

For which period delay you have charged that interest.

If it falls within 31st March, It's prior period, otherwise for the period in which you have raised the invoice.

As the term 'prior period items', as defined in this Standard, refers only toincome or expenses which arise in the current period as a result of errors or omissions in the preparation of the financial statements of one or moreprior periods.