Dear Sir,
Sub: Query regarding prsentation of Sale during Trial Run
Please refer to the above, recently I go through balance Sheet of Reliance Industries Ltd for the Financial Year 2011-12. As per Point no K for revenue recongnition of Significant Accounting Policies at Page No.117.
"Revenue is recognised only when it can be reliabily measured and it is reasonable to expect ultimate collection. Revenue from operations uncludes sale of goods, Service Tax, excise duty and SALES DURING TRIAL RUN PERIOD."
The same above presentation of Trial Run sale done in the annual report of Uttam Galva.
MY QUERY IS THAT IF THEY ARE PRESENTING TRIAL RUN SALE WITH NORMAL SALES THEN HOW THEY ARE CAPITALISING DIFFRENCE OF SALE PROCEEDS & EXPENDITURE MADE DURING TRIAL RUN PERIOD.
IS THERE ANY WAY TO SHOW FULL SALE OF TRIAL RUN WITH NORMAL SALE AND EXCESS OF EXPENDITURE OVER INCOME TO TRANSFER TO FIXED ASSETS ACCOUNT.
Thanks & Regards
Amit Kumar
Student CA Final
CAclubindia
