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

Tally related query!

Sourav Modi (Learner!) (306 Points)

13 September 2011

This query is related to valuation entry.

This is the first year I am closing my accounts in Tally. I have few shares in stock at the end of financial year. And I want to revalue them on the basis of rates on 31st March 2011. Since no purchase or sale is happenning here, how to revalue the shares?

Sourav

Reply
Follow
Share

11 Replies

C.A. Sandeep Wawhal (CA, PGDFM, BCom) (1831 Points)
Replied 13 September 2011

Share is not a stock it is an investment and it should be revalued at the time of sale.

Upgrade to CAclubindia Pro. Subscribe Now!

Sourav Modi (Learner!) (306 Points)
Replied 13 September 2011

well, if one is doing business in shares, then its treated as stock, not as investment.

avinash (CA final, article) (55 Points)
Replied 13 September 2011

SIR, WITH DUE RESPECTS

i am not pretty sure if any person with out a valid right can carry on trading in shares.

apart from that...SINCE THERE IS NO SALE IN THE CURRENT YEAR THEY BEING LONG TERM,

this is what as per AS-13

Long-term investments are usually carried at cost. However, when there is a decline, other than temporary, in the value of a long term investment, the carrying amount is reduced to recognise the decline.

the resultant reduction in the carrying amount is charged to the profit and loss statement. The reduction in carrying amount is reversed when there is a rise in the value of the investment, or if the reasons for the reduction no longer exist.

CS,CA F,Numrologi TusharSampat (CS CA F Numerologist Astrologer Graphologist Face reader Vastu Expert) (85930 Points)
Replied 13 September 2011

Originally posted by : avinash
	SIR, WITH DUE RESPECTS i am not pretty sure if any person with out a valid right can carry on trading in shares. apart from that...SINCE THERE IS NO SALE IN THE CURRENT YEAR THEY BEING LONG TERM, this is what as per AS-13 Normal 0 false false false MicrosoftInternetExplorer4 /* Style Definitions */ table.MsoNormalTable {mso-style-name:"Table Normal"; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-parent:""; mso-padding-alt:0in 5.4pt 0in 5.4pt; mso-para-margin:0in; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:10.0pt; font-family:"Times New Roman"; mso-ansi-language:#0400; mso-fareast-language:#0400; mso-bidi-language:#0400;} Long-term investments are usually carried at cost. However, when there is a decline, other than temporary, in the value of a long term investment, the carrying amount is reduced to recognise the decline. the resultant reduction in the carrying amount is charged to the profit and loss statement. The reduction in carrying amount is reversed when there is a rise in the value of the investment, or if the reasons for the reduction no longer exist.

Sourav Modi (Learner!) (306 Points)
Replied 13 September 2011

I want to clarify few things here. When I mentioned " this is the first year I am closing my accounts in tally", I meant the financial year 2010-11.

And when I mentioned "since no sale or purchase is happenning here", I meant that the transaction of revaluing the shares doesnt include any purchase or sale. It doesnt mean that no sale or purchase has happenned in the year 2010-11.

@ Anivash......As per my knowledge there is no prohibition for trading in shares. If there is any, please refer to the relevant provision/notification/circular of any act.

Sourav

Upgrade to CAclubindia Pro. Subscribe Now!

Prakash (Chartered Accountant) (560 Points)
Replied 13 September 2011

As per your clarification, you are holding some shares and as per AS-13, you want to revalue them as current investment and wish to know how to pass the transaction in Tally

So, same as per AS 13, revaluation of current investment should be done thgrough profit and Loss Account, So create on account Namely " Revaluation of Shares" with revenue nature and pass the entry as usual

For Upward Revaluation

Investment in SharesA/c Dr

To Revaluation of Shares A/c

Reverse for Downward Revaluation

For Tax implication on this refer IT Act

As far as my knowledge is concerned, its a capital receipt or loss and has no tax implications

Tax arises only when you transfer the shares and compute value taxable as diff between aquisition cost and Sale value

Ignore this comment if my perception of your clarification is wrong

Sourav Modi (Learner!) (306 Points)
Replied 13 September 2011

@ prakash......yes, you misinterpreted my clarification.........AS-13 doesnt come into picture at all since I am treating shares as stock and further its not accounting based query, its tally-specific query. Generally we revalue anything by just passing an entry but here in Tally since closing stock is valued on the basis of individual share values, we cant make any closing stock entries. To make any change in the value of closing stock, we have to route it through individual shares only. So, my query is ' without affecting the number of shares, how can one change the rate of such shares?'

Sourav

Praveen S H (CA FINAL) (22 Points)
Replied 13 September 2011

Can we not update the share value in Tally.

Robin (AUDITOR) (854 Points)
Replied 13 September 2011

Simple :

Lets say your standing in shares is

ABC Ltd 100 scrips @ Rs,100 = 10000

Value of share on 31st March 2011 is Rs.105

Now For the Incremental of Rs.5 you want to adjust in Tally ERP 9 !! right ?

Show the Incremental price separately with respective quantity as on that date. i.e ABC Ltd 100scrips at Rs5

Sourav Modi (Learner!) (306 Points)
Replied 13 September 2011

Thnx a lot Robin for atleast understanding my query!

Now coming to the solution, can you throw some light on how to show that incremental price separately. I mean if you go on to make an entry for that incremental price, the number of scrips will add up to 200. So I am not getting how to show that separately. Please tell us if such type of feature is there in tally.

Sourav