CA. Amit Daga
(Finance Controller CA. CS. CFA. CIFRS. M.COM. )
(9017 Points)
Replied 19 December 2007
HI,
Its depend upon the nature of transaction.
Hope you remember AS-1.
AS-1,Says something about substance over form(SOF).According to SOF,The auditor considers whether the financial statements reflect the financial reality of the entity rather than the legal form of the transactions and events which underlie them.
In your case,If its mere book entry.You cant book the loss,which you come to know by auditing.Wheather its mere book entry or real transaction.
If its not mere book entry than Priyanka"s is absolutely correct.
If its mere book entry than depreciation is as usual and this transaction will not be treated as a purchase & sells transaction