Jaiib Bookkeeping b

7/28/2019 Jaiib Bookkeeping b

1/89

ACCOUNTING AND FINANCE FOR

BANKERS Book Keeping - Module B

K.ESWAR. MBA( XLRI)

CHIEF MANAGER & FACULTYSPBT COLLEGE. MUMBAI


2/89

DEFINITION AND SCOPE ACCOUNTING

STANDARDS.

ACCOUNTING IS LANGUAGE OF BUSINESS.

COMMUNICATE THE RESULT OF BUSINESSOPERATIONS AND ITS OTHER ASPECTS.

ACCOUNTING IS AN ART OF RECORDINGCLASSIFYING AND SUMMARIZING IN ASIGNIFICANT MANNER AND IN TERMS OFMONEY TRANSACTIONS AND EVENTS WHICH

ARE IN PART AT LEAST OF FINANCIALCHARACTER AND INTERPRETING THE RESULTSTHEREOF.


3/89

DIFFERENCE BETWEEN ACCOUNTANY

AND BOOKKEEPING.

BOOK KEEKPING IS MERELY RECORDING THE BUSINESSTRANSACTIONS IN BOOKS AND LEDGERS .

ACCOUNTANCY IS WIDER CONCEPT: COMPLIATION OFACOUNTS IN SUCH A WAY THAT ONE IS IN A POSITIONTO UNDERSTAND STATE OF AFFAIRS OF BUSINESS.

USERS OF FINANCIAL STATEMENTS ARE INCOME TAXDEPARTMENT, S.T DEPARMENT SHAREHOLDERS,INVESTORS ,BANKS AND FIS AND SO ON.

IT IS IN THE INTEREST OF ALL THAT FINANCIALSTATEMENTS REFLECT TRUE AND FAIR VIEW OF STATEOF AFFIAIRS OF A BUSINESS ENTITY.


4/89

ACCOUNTANCY

ACCOUNTANCY INVOLVES:

SYSTAMATIC CLASSIFICATION OF BUSINESS

TRANSACTIONS IN TERMS OF MONEY AND

FINANCIAL CHARACTER.

SUMMARIZING : TRAIAL BALANACE AND B/S

INTERPRETING THE FINANCIALTRANSACTIONS.


5/89

PURPOSE OF ACCOUNTANCY

TO KEEP A SYSTAMATIC RECORD

TO ASCERTAIN THE RESULTS OF OPERATIONS

TO ASCERTAIN FINANCIAL POSITION OFBUSINESS.

TO FACILITATE RATIONAL DECISION MAKING

TO SATISFY REQUIREMENT OF LAW ANDUSEFUL IN MANY RESPECTS.


6/89

CONCEPTS OF ACCOUNTANCY.

COST CONCEPT: BUSINESS TRANSACTIONS ARERECORDED IN BOOKS AT COST PRICE.

FIXED ASSETS ARE KEPT AT COST OF PURCHASEAND NOT AT THEIR MARKET PRICE.

EVERY TRANSACTION IS RECORDED WITHPRESENT VALUE AND NOT ANY FUTURE VALUE.

UNREALIZED GAINS ARE IGNORED.

COST OF AN ASSET THAT HAS LONG BUT LIMITEDLIFE IS SYSTAMATICALLY REDUCED BY A PROCESSCALLED DEPRECIATION. BUT SUCH DEPRECIATIONHAS NO RELATION TO MARKET VALUE OF ASSET.


7/89

MONEY MEASUREMENT CONCEPT

MONEY MEASUREMENT CONCEPT: EVERY

TRANSACTION IS MEASURED IN TERMS OF

MONEY. VIZ PRODUCTION/SALES/WAGES ETC

ALL CONVERTED TO MONEY.

INFLATION OR DEFLALTION NOT INCLUDED IN

VALUE OF ANY ASSET.


8/89

BUSINESS ENTITY CONCEPT

THIS CONCEPT SEPARATES THE ENTITY OF PROPRIETORFROM THE BUSINESS TRANSACTION.

CAPITAL CONTRIBUTED BY THE OWNER IS LIABILITYFOR BUSINESS BECAUSE BUSINESS IS DIFFERENT FROM

OWNER. ANY MONEY WITHDRAWN BY PROP. IS DRAWINGS.

PROFIT IS LIABILITY AND LOSS IS AN ASSET.

ALL ENTRIES ARE KEPT FROM THE POINTOF VIEW OF

BUSINESS AND NOT FROM OWNER. AN ENTERPRISE IS ECONOMIC UNIT SEPARATE FROM

OWNER.


9/89

REALISATION CONCEPT.

THIS CONCEPT TELLS US WHEN REVENUE IS

TREATED AS REALISED OR EARNED. IT IS

TREATED AS REALIZED ON THE DATE WHEN

PROPERTY IN GOODS PASSES TO BUYER AND

HE BECOMES LEGALLY LIABLE TO PAY.

NO FUTURE INCOME IS CONSIDERED.

GOODS SOLD ON APPROVAL WILL BE

INCLUDED IN SALES BUT ON COST ONLY.


10/89

GOING CONCERN CONCEPT

BUSINESS IS A GOING CONCERN ANDTRANSACTIONS ARE RECORDED ACCORDINGLY.

IF AN EXPENSE IS INCURRED AND UTILITY ISCONSUMED DURING THE YEAR, THEN IT ISTREATED AS AN EXPENSE OTHERWISE IT ISRECORDED AS AN ASSET.

RESERVES AND PROVISIONS ARE CREATED FORANY FUTURE LIABILITY.

DEFERRED REVENUE EXPENDITURE IS WRITTENOFF OVER NUMBER OF YEARS.

WHY LOSS IS SHOWN UNDER ASSETS SIDE ?


11/89

DUAL ASPECT CONCEPT

EVERY TRANSACTION HAS DOUBLE EFFECT.

ACCOUNTING EQUATION: ASSETS= CAP+

LIABILITY.


12/89

ACCOUNTING PERIOD CONCEPT.

BUSINESS WILL RUN THROUGH LONG PERIOD. HENCEACCOUNTS OF EACH PERIOD IS RECORDED.

RESULTS OF OPERATIONS CAN BE KNOWN PRECISELYONLY AFTER BUSINESS CEASES TO OPERATE AND

ENTIRE ASSETS ARE SOLD AND ENTIRE LIABILITIES PAID. BUT ONE IS INTERESTED IN KNOWING PERIODICALY

OPERATING RESULTS OF BUSINESS SAY YEARLY OR HALFYEARLY OR QUARTERLY.

HENCE ALL THE EXPENSES OR INCOME DURING THISACCOUNTING PERIOD HAS TO BE TAKEN INTOCONSIDERATION IRRESPECTIVE OF WHETHER THEYARE REALISED IN CASH OR PAID IN CASH.


13/89

ACCOUNTING FOR FULL DISCLOSURE

DISCLOSURE OF MATERIAL FACTS.( MATERIAL

AND IMMATERIAL FACT IS MATTER OF

JUDDGEMENT)

CONTINGENT LIABILITY

MARKET VALUE OF INVESEMENTS.


14/89

CONVENTION OR PRINCIPLES OF

CONSERVATISM

ALL POSSIBLE LOSSES TO BE TAKEN INTO

CONSIDERATION AND ANTICIPTED PROFITS TO

BE IGNORED.

CREATION OF PROVISION FOR DOUBTFUL

DEBTS.

VALUE OF STOCK

CONVENTION OF CONSISTENCY: METHOD OF

DEPREICATION.


15/89

DOUBLE ENTRY SYSTEM

SCIENTIFIC SYSTEM:

EVERY TRANSACTION HAS TWO ASPECTS.

CRUX OF ACCOUNTANCY IS TO FIND OUTWHICH TWO ACCOUNTS ARE EFFECTED AND

WHICH IS TO BE DEBITED AND WHICH IS TO

BE CREDITED.


16/89

JOURNAL

JOURNAL RECORDS EACH AND EVERY

RECORD.

BUT TO FIND OUT A TRANSACTION EFFECTING

A PERSON, EXPENSES ACCOUNT OR ASSET

ONE HAS TO TURNOVER ALL PAGES OF

JOURNAL .

HENCE TRANSACTIONS ARE POSTED FROM

JOURNAL TO PARTICULAR PAGES OF LEDGER.

HENCE JOURNAL CONTAINA COLUMN L.F


17/89

JOURNAL FORMAT

DATE PARTICULARS L.F DEBIT RS. CREDIT RS.


18/89

CASH BOOK

CASH BOOK KEEPS RECORDS OF ALL CASH

TRANSACTIONS I.E CASH RECEIPTS AND CASH

PAYMENTS. ALL RECEIPTS ARE RECORDED ON

RIGHT SIDE AND ALL PAYMENTS ON LEFT SIDE.

CASH BOOK IS BOOK OF ORIGINAL ENTRY.


19/89

CASH BOOK FORMAT

DR. CR

DATE PARTI

CULA

RS

R.NO L.F CASH BANK DISCO

UNT

DATE PARTI

CULA

RS

VR.NO

.

LF CASH BANK DISCO

UNT


20/89

RECORD KEEPING BASIS RECORDING: JOURNALISING AS AND WHEN TRANSACTION TAKES PLACE.

JOURNAL IS BOOK OF ORIGINAL OR FIRST ENTRY. CLASSIFYING: ALL ENTRIES IN JOURNAL OR SUBSIDIARY BOOKS ARE

POSTED TO LEDGER ACCOUNT(POSTING) TO FIND OUT AT A GLANCE THE

TOTAL EFFECT OF ALL SUCH TRANSACTIONS. LEDGER IS BOOK OF

SECONDARYENTRY.

SUMMASRISING: LAST STAGE IS TO PREPARE THE TRIAL BALANCE ANDFINAL ACCOUNTS WITH A VIEW TO ASCERTAIN THE PROFIT OR LOSS

DURING PARTICULAR PERIOD.

IT IS CUSTOMARY TO USE TO AND BY WHILE POSTING LEDGER.

BALANCING AN ACCOUNT MEANS EQUALIZTING TWO SIDES.

IF DEBIT SIDE OF ACCOUNT EXCEED CREDIT SIDE, DIFFERENCE IS PUT ON

CREDIT SIDE AND IT IS SAID TO HAVE DEBIT BALANCE AND VICE VERSA..


21/89

LEDGER

DR CR

DATE PARTICU

LARS

J.F AMOUN

T(RS)

DATE PARTICU

LARS

J.F AMOUN

T RS.


22/89

Questions.

CREDIT BALANCE IN CAPITAL ACCOUNT IS

LIABILITY OR AN ASSET:

A. LIBILITY

B. A REVENUE

C. AN EXPENSE

D. NONE OF THESE.


23/89

QUESTION

AMOUNT BROUGHT IN BY PROPRIETOR IN

BUSINESS SHOULD BE CREDITED TO

A. PROPRIETORS ACCOUNT

B.DRAWINGS ACCOUNT

C.CAPITAL ACCOUNT

D.ASSET ACCOUNT


24/89

QUESTIONS

WAGES PAID TO RAJU TO BE DEIBED TO

A. RAJU

B WAGES C. CASH

D. BANK


25/89

QUESTIONS.

Q. CREDIT SALES MADE TO ROHIT TO BE

DEIBTED TO

A. SALES

B. PURCHASE

C. CASH

D. ROHIT


26/89

QUESTIONS

FURNITURE PURCHASED BY ISSUING CHEQUE

WHAT ENTRIES TO BE PASSED

A. DEBIT FURNITURE AND CREDIT BANKACCOUNT

DEBIT BANK ACCOUNT AND CREDIT

FURNITURE

DEBIT FURNITURE AND CREDIT CASH.

DEBIT BANK AND CREDIT FUNITURE SHOP

ACCOUNT


27/89

QUESTIONS

RETURN OF GOODS SHOULD BE CREDITED TO

A. SALES RETURN

B PURCHASE RETURN C.CUSTOMER ACCOUNT

D. GOODS ACCOUNT


28/89

MATCH FOLLOWING

A B

A RAMESH 1 REAL

B DENA BANK 2 PERSONAL

C RENT 3 NOMINAL

D COMPUTER 4 REAL

E LAND 5 NOMINAL

F DISCOUNT 6 PERSONAL


29/89

QUESTION

WHAT IS JOURNAL ENTRY

A. ORIGINAL ENTRY

B. DOUBLE ENTRY C DUPLICATE ENTRY

NONE


30/89

QUESTION

TRANSACTION IN BANK COLUMN ON CREDIT

SIDE OF THREE COLUMNAR CASH BOOK

INDICATE

A. AMOUNT WITHDRAWN FROM BANK

B.AMOUNT DEPOSITED IN BANK

C.BOTH A AND B

D. NONE


31/89

QUESTION

PASS JOURNAL ENTRY:

RENT PAID FOR OFFICE PREMISES RS.30000

OUT OF WHICH PART AMOUNT OF RS.10000

PAID BY CHEQUE AND REST BY CASH.


32/89

QUESTION

PASS JOURNAL ENTRY:

PURCHASED 100 SHARES OF CENTRAL BANK

OF INDIA FOR RS.100 PER SHARE.


33/89

QUESTIONS

PASS JOURNAL ENTRY:

SOLD GOODS TO TENDULKAR RS.15000


34/89

QUESTIONS

PASS JOURNAL ENTRY:

DRAVID INVOICED GOODS FOR RS.12000 TO

US.


35/89

QUESTIONS

PASS JOURNAL ENTRY:

RECEIVED DUE AMOUNT FROM

TENDULAKAR AND ALLOWED HIM DISCOUNT

OF 10%


36/89

QUESTIONS

PASS JOURNAL ENTRY:

PAID SALARY AND RENT RS.1200 AND 1500

RESPECTIVELY.


37/89

QUESTIONS

PASS JOURNAL ENTRY:

KIRAN BECAME INSOLVENT. HE HAD TO PAY

10000 TO US. BUT WE RECEIVED ONLY 25

PAISE A RUPEE.


38/89

QUESTION

PASS JOURNAL ENTRY:

PAID MONTHLY CAR INSTALMENT OF

PROPRIETORS PERSONAL CAR RS.12000


39/89

QUESTION

PASS JOURNAL ENTRY:

BOUGHT FURNITURE FROM GODREJ AND

PAID BY CHEQUE RS.50000


40/89

QUESTION

PASS JOURNAL ENTRY:

DEPOSITED CASH IN BANK RS.1000


41/89

QUESTION

JOURNALIZE FOLLOWING:

COMMENCED BUSINESS WITH Rs.15000 OF

WHICH RS.5000 WAS BORROWED FROM HIS

WIFE AT 12% INTEREST P.A.


42/89

QUESTIONS

PASS JOURNAL ENTRY:

PURCHASED GENERATOR FROM RAMA & CO.

RS.50000


43/89

QUESTIONS

PASS JOURNAL ENTRY:

PAID CARRIAGE AND CARTERAGE ON GOODS

SOLD TO NAYAN ON HIS BEHALF.


44/89

QUESTION

PASS JOURNAL ENTRY:

BOUGHT GOODS FROM SATISH AT ONE

MONTHS CREDIT RS.6000

OUT OF WHICH HALF WAS INVOICED TO MR.

RAM AT 30% ABOVE COST.


45/89

Adjusting and closing entries.

While preparing trading and profit and loss

account all expenses and income for the full

period are to be taken into consideration. If

expenses have been incurred but not paidduring that period ,liabilities for unpaid

amount should be created before the

accounts can be said to show the actual profitand loss. All expenses and income should

properly be adjusted through accounting

entries.


46/89


Trial balance is prepared from the books of

accounts of organiztion. Final accounts are the

final processof accounting. Once the trial

balance is prepared the books are half wayclosed.

Now all ajusting enties passed at the time of

preparing the final accounts have dual effecti.e both debit and credit.

Hence all adjusting entries passed after Trial

balance drawn will have two effects.


47/89


One in either trading and profit and loss

account and other in Balance sheet or one in

trading account and other in Profit and loss

account.


48/89


Some examples:

Closing stock adjustment:

Will be shown in asset side of balance sheet

and will be shown in credit side of trading

account.

Goods lost by fire:

Will be shown in credit side of trading

account.

Will be shown on debit side of profit and loss


49/89


Outstanding expenses:

Will be shown in debit side of profit and loss

account.

Will be shown in liabilities side of balance

sheet.

Prepaid expenses:

Prepaid expensesshown in Asset side ( Dr Pre

paid expenses) and Credit P&L Expenditure as

they do not pertain to current year.


50/89


Depreciation: It is fall in value of asset due to

use or passage of time.

Depreciation Dr.

To asset account.


51/89

ACCOUNTING STANDARDS.

INSTITUTE OF CHARTERED ACCOUNTANTS OFINDIA RECOGNISING THE NEED TOHARMONISE THE DIVERSE ACCOUNTING

POLICIES AND PRACTICES CONSTITUTED ANACCOUNTING STANDARDS BOARD IN THEYEAR 1977.

ASB FORMULATE ACCOUNTING STANDRDS SO

THAT COUNCIL OF ICAI MAY MANDATE SUCHSTANDARDS.

OBJECTIVES QUESTIONS ON


52/89

OBJECTIVES QUESTIONS ON

ACCOUNTING STANDARDS

Q. MANDATORY ACCOUNTING STANDARD IF

NOT FOLLOWED REQUIRES AUDITORS WHO

ARE MEMBERS OF ICAI TO :

A. QUALIFY THEIR AUDIT REPORTS.

B. INFORM TO MANAGEMENT OF COMPANY

C. INFORM TO ICAI

D. NEED NOT REPORT ANYTHING.


53/89

QUESTIONS

SEBI AND COMPANYS ACT REQUIRE

AUDITORS TO QUALIFY AUDIT REPORTS THAT

A. THAT DO NOT CONFORM TO MANDATORY

ACCOUNTING STANDARDS. B. CONFORM TO MANDATORY ACCOUNTING

STANDARDS.

C. DO NOT CONFORM TO ACCOUNTINGSTANDARDS.

D . NO RESPOSIBILITY ON AUDITORS.


54/89

QUESTIONS.

Q WHICH SECTION OF COMPANIES ACT CAST

RESPONSIBILITY ON BOARD OF DIRECTORS TO

COMPLAY WITH MANDATORY ACCOUNTING

STANDARDS:

A. SECTION 217(2AA)

B. SECTION 215

C. SECTION 125

D. SECTION 44.

DAY BOOK AND GLB POSTING IN A


55/89


BANK..

IN THE CONTEXT OF ACCOUNTING IN BANKS

DAY BOOK OR CASH BOOK (BOTH ARE USED IN

SAME CONTEXT : SOME BANKS CALL IT CASH

BOOK SOME BANKS CALL IT DAY BOOK) HASSUMMARY OF TOTAL TRANSACTIONS IN

RESPECT OF EACH ACCOUNTING HEAD OF

BALANCESHEET AND PROFIT AND LOSSACCOUNT.

THE AMOUNT OF EACH OF TRANSACTIONS

DONE IN BRANCH OF BANK IN THE DAY ARE



56/89


BANK..

SUMMARIZED AND RECORDED HERE. FOR

INSTANCE ALL THE TRANSACTIONS IN SAVINGS

ACCOUNTS OR ALL TRANSACTIONS IN

CURRENT DEPOSITS ACCOUNTS ARERECORDED IN SUMMARIZED FORM WITH

REGARD TO BOTH DEBIT AND CREDIT SIDE.

WHICH ARE BROUGHT FROMSUPPLEMENTARY BOOKS WHICH ARE AGAIN

SUB SUMMARY OF TRANSACTIONS IN AN

ACCOUNT SAY SAVINGS OR CD.



57/89


BANK.. FROM DAY BOOK THE FINAL DEBITS AND CREDITS

ARE POSTED IN THE RESPECTVE LEDGERS WHICH IS

KNOWN AS GENERAL LEDGER. GENERAL LEDGER IS

NOTHING BUT BOOK CONTAINING INDIVIDUAL

LEDGERS FOR EACH INDIVIDUAL TYPE OF ASSET OR

LIABILITIES. FOR INSTANCE ENTIRE CURRERNT

DEPOSIT TRANSACTIONS ARE POSTED IN CURRENT

ACCOUNTING HEAD IN GENERAL LEDGER. SIMILARLYFOR SAVINGS ACCOUNT OR FURTNIUTE ACCOUNT

OR STATIONERY ACCOUNT AND SO ON.



58/89


BANK..

THE GENERAL LEDGER BALANCE IS VIRTUALLY

TRIAL BALANCE OF THE BANK ON A

PARTICULAR DAY. IT REFLECT THE BALANCES

OF ALL ACCOUNTS . WHILE PREPARINGBALANCESHEET AND PROFIT AND LOSS

ACCOUNT OF BRANCH OF BANK THE GLB

BALANCES ARE TAKEN. BALANCESHEET OF ALL BRANCHES TOGETHER

WHEN CONSOLIDATED BECOMES THE

BALANCE SHEET OF BANK.

GENERALLY ACCEPTED


59/89

GENERALLY ACCEPTED

ACCOUNTING PRINCIPLES.

The common set of accounting principles,

standards and procedures that companies use

to compile their financial statements. GAAP

are a combination of authoritative standards(set by policy boards) and simply the

commonly accepted ways of recording and

reporting accounting information.

GENERALLY ACCEPTED


60/89

GENERALLY ACCEPTED

ACCOUNTING PRINCIPLES

GAAP are imposed on companies so that

investors have a minimum level of consistency

in the financial statements they use when

analyzing companies for investment purposes.GAAP cover such things as revenue

recognition, balance sheet item classification.

Companies are expected to follow GAAP ruleswhen reporting their financial data via

financial statements.

GENERALLY ACCEPTED


61/89

GENERALLY ACCEPTED

ACCOUNTING PRINCIPLES

That said, keep in mind that GAAP is only a set

of standards. What is important that itsunderlying objectives are followed in true

perspective.



62/89


AS -1 ALL SIGNIFICANT POLICIES ADOPTED IN

PREPARATION OF FINANCIAL STATEMENTS

SHOULD BE DISCLOSED. ANY CHANGE IN ACCOUNTING POLICIES

WHICH HAS MATERIAL EFFECT IN CURRENT

PERIOD OR IN LATER PERIOD SHOULD BE

DISCLOSED.


63/89

AS 2

DEALS WITH DETERMINATION OF VALUE AT

WHICH INVENTORIES ARE CARRIED/VALUED

INVENTORIES TO BE VALUED AT LOWER OF

COST OR NET REALISABLE VALUE.

AVERAGE COST OR FIFO METHODS ARE

PERMITTED IN CASE WHERE GOODS ARE

INTERCHANGEABLE.


64/89

AS-3

PREPARATION OF CASH FLOW STATEMENT

AND ITS PRESENTATION ALONGWITH

FINANCIAL STATEMENTS

CASH FLOW TO BE CLASSIFIED BY

OPERATING/INVESTING/FINANCING

ACTIVITIES.


65/89

AS 4 TREATMENT OF CONTINGENCIES AND EVENTS IN FINANCIAL

STATEMENTS. EG. CASES IN HIGH COURT OR PENALTY PROCEEDINGS UNDER

LAW.

CONTINGENCIES MUST BE PROVIDED IF LOSSES CAN BE

ESTIMATED. EVENTS AFTER BALANCESHEET DATE AND BEFORE APPROVAL

OF BOARD OF DIRECTORS SHOULD BE APPROPRIATELY

ADJUSTED IN VALUE OF ASSETS AND LIABILITIES.

IF INSUFFECIENT EVIDENCE, DISCLOSURE TO BE MADE CONTINGENT GAINS ARE NOT RECOGNIZED.


66/89

AS-5

DEALS WITH TREATEMENT OF PRIOR PERIOD

AND EXTRAORDINARY EVENTS.

DEBITS OR CREDITS WHICH ARISE IN

CURRENT YEAR OR AS A RESULT OFOMMISSION/MISTAKES IN PRIOR YEAR.

ALSO EXTRAORDINARY ITEMS LIKE WRITING

OFF IVENTORIES.

DISPOSAL OF FIXED ASSETS.


67/89

AS -6

DEPRECIATION IS MEASURE OF WEARING OUT

ASSETS.

DEPRECIATION METHOD SHOULD CAREFULLY

BE SELECTED AND CONSISTENCY APPLIED FORYEAR TO YEAR.

TREATMENT FOR REVALUATION OF ASSETS

DEPRECIATION METHOD TO BE DISCLOSED.


68/89

AS-7 ACCOUNTING OF CONSTRUCTION CONTRACTS

.CONTRACT FOR CONSTRUCTION EXCEED ONE YEAROR SO.

ACCOUNTING ISSUES OF REVENUE, TREATMENT OF

ADVANCE RECEIVED, WORK IN PROGRESS, IN

FINANCIAL STATEMENTS.

TYPES OF CONTRACTS: FIXED PRICE CONTRACT +

ESCALATION COST OR COST PLUS A FIXED FEE.

AMOUNT AND METHOD USED TO DETERMINEREVENUE RECOGNIZED.


69/89

AS-8

STAND DELETED FROM 1.4.03 R&D EXPENSESARE NOW COVERED ON AS-10


70/89

AS-9

BASIS FOR RECOGNITION OF REVENUE I.E

INCOME AND TIME WHEN INCOME IS SAID

TO HAVE ARISEN

WHEN REVENUE RECOGNITION POSTPONED ,DISCLOSURE OF CIRCUMASTANCES TO BE

MADE.


71/89

AS-10

ACOUNTING OF FIXED ASSETS AND DISCLOSURE

THERE OF.

COMPONENTS OF COST.

PURCHASE PRICE: + IMPORT DUTY+TAXES+DIRECTCOST TO BRING ASSET TO ITS WORKING CONDITION-

TRADE DISCOUNTS.

FINANCING COST TO THE EXTENT SUCH COST RELATE

TO PERIOD AFTER SUCH ASSETS ARE READY TO USE-

NOT TO BE CAPITALIZED.

TEST RUN EXPENSES CAPITALIZED.


72/89

AS-11

TRANSLATION OF ACOUNTING TRANSACTION INFOREIGN CURRENCIES IN REPORTING CURRENCY.

FINANCIAL STATEMENT OF FOREIGN OPERATIONS

FORWARD EXCHANGE CONTRACTS.

EXCHANGE DIFFERENCE INCLUDED I.E PROFIT OR

LOSS TO BE DISCLOSED.


73/89

AS-12

GOVERNMENT GRANTS RECEIVED BY AN

ENTITY.

SUBSIDIES/CASH INCENTIVE/DUTY DRAWBACK

DOES NOT INCLUDE ANY TAX EXEMPTION OR

TAX HOLIDAY.


74/89

AS-13

ACCOUNTING FOR INVESEMENTS MADE BY

AN ENTITY.

CURRENT AND LONG TERM.


75/89

AS-14

AMALGAMATION OF TREATMENT OF

RESULTANT GOODWILL OR RESERVES

TAKE OVER OF EXISTING BUSINESS AND

FORMATION OF NEW BUSINESS.


76/89

AS-15

ACCOUNTING OF RETIREMENT BENEFIT TO

EMPLOYEES IN FINANCIAL STATEMENTS

PF/PENSION/GRATUIITY LEAVE ENCASHMENT

POST RETIREMENT WELFARE SCHEME

METHOD BY WHICH RETIREMENT BENEFITS

VALUED.


77/89

AS-16

CAPITALIZATION OF BORROWING COST

ATTTRIBUTABLE TO

ACQUISITION/CONSTRUCTION OR

PRODUCTION WHERE QUALIFYING ASSETTAKES SUBSTANTIAL PERIOD TO GET IT READY

FOR INTENDED USE OR SALE.


78/89

AS-17

SEGMENT REPORTING

REPORTING OF INFORMATION ABOUT

DIFFERENT TYPES OF PRODUCT AND

SERVICES OF AN ENTERPRISE AND ITSOPERATIONS IN DIFFERENT GEOGRAPHICAL

AREAS.

FOR ASSESSING RISK AND RETURN OFDIVERSIFIED OR MULTILOCATIONAL

ENTERPRISE.


79/89

AS-18

REPORTING OF RELATED PARTY RELATIONSHIP

AND TRANSACTIONS BETWEEN A REPORTING

ENTERPRISE AND RELATED PARTY.

NAME OF RELATED PARTY AND RELATIONSHIPWHERE CONTROL EXIST TO BE DISCLOSED.


80/89

AS-19

LEASE: A LEASE AN AGREEMENT WHEREBY

THE LESSOR CONVEYS TO THE LESEE IN

RETURN FOR A PAYMENT OR SERIES OF

PAYMENTS THE RIGHT TO USE AN ASSET FORA AGREED PERIOD.

ACCOUNTING POLICIES FOR LESSOR AND

LESSEE AND DISCLOSURE IN RELATION TOFINANCIAL LEASE AND OPERATING LEASE.

S 20


81/89

AS-20

PRINCIPLES & DETERMINATION OF EARNING

PER SHARE

COMPARISON BETWEEN ENTERPRISES.

NET PROFI(LOSS)/ WEIGHTED AVERAGE

NUMBER OF SHARES.

AS 21


82/89

AS 21

CONSOLIDATED FINANCIAL STATEMENT OF

PARENT AND SUBSIDARIES.

AS 22


83/89

AS-22

METHOD OF DETERMINATION OF AMOUNTOF EXPENSES OR SAVING RELATING TO TAXES

ON INCOME IN RESPECT OF AN ACCOUNTING

PERIOD. DEFERRED TAX ASSETS AND LIABILITIES

SHOULD BE DISTINGUISHED FROM CURRENT

TAX ASSETS AND LIABILITIES

AS 23


84/89

AS-23

ACCOUNTING FOR INVESTMENT INASSOCIATES.

AS 24


85/89

AS-24

DISCONTINUATION OF OPERATION OFPARTICULAR SEGMENT.

DISCLOSURE OF PRE TAX PROFIT OR LOSS

FROM ACTIVITIES ATTRIBUTABLE TODISCONTINUING OPERATIONS.

AS 25


86/89

AS-25

INTERIM REPORTING WHICH IS NOT FORCOMPLETE REPORTING PERIOD.

CONDENSED B/S

CONDENSED P&L

CONDENSED CASH FLOW STATEMENT

EXPLANATORY NOTES.

AS 26


87/89

AS-26

OTHER THAN INTANGIBLE ASSETS COVERED IN AS-22( DEFERRED TAX ASSETS)

RELATE TO START UP COST ( EG ADVT ETC)

R&D

PATENTS AND COPY RIGHT

GOODWILL

DISCLOSURE: USEFUL LIFE OR AMORATIZATION RATE AMORATIZATION METHOD.

AS 27


88/89

AS-27

TWO OR MORE PARTIES UNDER TAKEECONOMIC ACTIVITY WITH JOINT CONTROL

ACCOUNTING FOR JOINT VENTURE IN A

CONSOLIDATED FINANCIAL STATEMENT.

DISCLOSURE: ANY CONTINGENT LIABILITY

INCURRED BY VENTURER AND ITS SHARE.

ANY CAPITAL COMMITMENT AND ITS SHARE.

AS 28


89/89

AS-28

EQUITY OR DEBT LISTED

TURNOVER EXCEED RS.50 CRORES

PRINCIPAL OF THIS A.S IS TO ENSURE

CARRYING COST OF ASSET IS NOT MORE THAN

RECOVERABLE VALUE OF ASSET.

NOT APPLIED TO INVENTORIES AS 2

CONSTRUCTION CONTRACT AS 7

FINANCIAL ASSETS AS 13 & DEF TAX AS 22

Jaiib Bookkeeping b

Documents

Transcript of Jaiib Bookkeeping b