NIVETHITHA (CA FINAL STUDENT) (60 Points)
08 August 2009A Firm Was converted into Company In The Previous Year 2007-08.
Till 31.12.2007 it was a firm after that it was converted into a Private limited comany.
Now My Doubt is that, the expense incurred by the firm to convert itself into a company can be called as preliminary expense or not.
If Yes why,if reply is no please explain it.
Aditya Maheshwari
(CA in Practice)
(35867 Points)
Replied 14 August 2009
As it is preincorporation expenses of the company the same will be treated as preliminary expenses.
CA Ramesh Kr Verma
(Partner)
(138 Points)
Replied 16 August 2009
Any expense incurred for formation of a company whether by conversion or a new formation is treated as pre-operative expenses.
CAclubindia
