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Title: ACCOUNTING%20AND%20FINANCE%20FOR%20BANKERS%20


1
ACCOUNTING AND FINANCE FOR BANKERS Book Keeping
- Module B
  • K.ESWAR. MBA( XLRI)
  • CHIEF MANAGER FACULTY
  • SPBT COLLEGE. MUMBAI

2
DEFINITION AND SCOPE ACCOUNTING STANDARDS.
  • ACCOUNTING IS LANGUAGE OF BUSINESS.
  • COMMUNICATE THE RESULT OF BUSINESS OPERATIONS AND
    ITS OTHER ASPECTS.
  • ACCOUNTING IS AN ART OF RECORDING CLASSIFYING
    AND SUMMARIZING IN A SIGNIFICANT MANNER AND IN
    TERMS OF MONEY TRANSACTIONS AND EVENTS WHICH ARE
    IN PART AT LEAST OF FINANCIAL CHARACTER AND
    INTERPRETING THE RESULTS THEREOF.

3
DIFFERENCE BETWEEN ACCOUNTANY AND BOOKKEEPING.
  • BOOK KEEKPING IS MERELY RECORDING THE BUSINESS
    TRANSACTIONS IN BOOKS AND LEDGERS .
  • ACCOUNTANCY IS WIDER CONCEPT COMPLIATION OF
    ACOUNTS IN SUCH A WAY THAT ONE IS IN A POSITION
    TO UNDERSTAND STATE OF AFFAIRS OF BUSINESS.
  • USERS OF FINANCIAL STATEMENTS ARE INCOME TAX
    DEPARTMENT, S.T DEPARMENT SHAREHOLDERS, INVESTORS
    ,BANKS AND FIS AND SO ON.
  • IT IS IN THE INTEREST OF ALL THAT FINANCIAL
    STATEMENTS REFLECT TRUE AND FAIR VIEW OF STATE OF
    AFFIAIRS OF A BUSINESS ENTITY.

4
ACCOUNTANCY
  • ACCOUNTANCY INVOLVES
  • SYSTAMATIC CLASSIFICATION OF BUSINESS
    TRANSACTIONS IN TERMS OF MONEY AND FINANCIAL
    CHARACTER.
  • SUMMARIZING TRAIAL BALANACE AND B/S
  • INTERPRETING THE FINANCIAL TRANSACTIONS.

5
PURPOSE OF ACCOUNTANCY
  • TO KEEP A SYSTAMATIC RECORD
  • TO ASCERTAIN THE RESULTS OF OPERATIONS
  • TO ASCERTAIN FINANCIAL POSITION OF BUSINESS.
  • TO FACILITATE RATIONAL DECISION MAKING
  • TO SATISFY REQUIREMENT OF LAW AND USEFUL IN MANY
    RESPECTS.

6
CONCEPTS OF ACCOUNTANCY.
  • COST CONCEPT BUSINESS TRANSACTIONS ARE RECORDED
    IN BOOKS AT COST PRICE.
  • FIXED ASSETS ARE KEPT AT COST OF PURCHASE AND NOT
    AT THEIR MARKET PRICE.
  • EVERY TRANSACTION IS RECORDED WITH PRESENT VALUE
    AND NOT ANY FUTURE VALUE.
  • UNREALIZED GAINS ARE IGNORED.
  • COST OF AN ASSET THAT HAS LONG BUT LIMITED LIFE
    IS SYSTAMATICALLY REDUCED BY A PROCESS CALLED
    DEPRECIATION. BUT SUCH DEPRECIATION HAS NO
    RELATION TO MARKET VALUE OF ASSET.

7
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
BUSINESS ENTITY CONCEPT
  • THIS CONCEPT SEPARATES THE ENTITY OF PROPRIETOR
    FROM THE BUSINESS TRANSACTION.
  • CAPITAL CONTRIBUTED BY THE OWNER IS LIABILITY FOR
    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
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
GOING CONCERN CONCEPT
  • BUSINESS IS A GOING CONCERN AND TRANSACTIONS ARE
    RECORDED ACCORDINGLY.
  • IF AN EXPENSE IS INCURRED AND UTILITY IS
    CONSUMED DURING THE YEAR, THEN IT IS TREATED AS
    AN EXPENSE OTHERWISE IT IS RECORDED AS AN ASSET.
  • RESERVES AND PROVISIONS ARE CREATED FOR ANY
    FUTURE LIABILITY.
  • DEFERRED REVENUE EXPENDITURE IS WRITTEN OFF OVER
    NUMBER OF YEARS.
  • WHY LOSS IS SHOWN UNDER ASSETS SIDE ?

11
DUAL ASPECT CONCEPT
  • EVERY TRANSACTION HAS DOUBLE EFFECT.
  • ACCOUNTING EQUATION ASSETS CAP LIABILITY.

12
ACCOUNTING PERIOD CONCEPT.
  • BUSINESS WILL RUN THROUGH LONG PERIOD. HENCE
    ACCOUNTS OF EACH PERIOD IS RECORDED.
  • RESULTS OF OPERATIONS CAN BE KNOWN PRECISELY
    ONLY 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 HALF
    YEARLY OR QUARTERLY.
  • HENCE ALL THE EXPENSES OR INCOME DURING THIS
    ACCOUNTING PERIOD HAS TO BE TAKEN INTO
    CONSIDERATION IRRESPECTIVE OF WHETHER THEY ARE
    REALISED IN CASH OR PAID IN CASH.

13
ACCOUNTING FOR FULL DISCLOSURE
  • DISCLOSURE OF MATERIAL FACTS.( MATERIAL AND
    IMMATERIAL FACT IS MATTER OF JUDDGEMENT)
  • CONTINGENT LIABILITY
  • MARKET VALUE OF INVESEMENTS.

14
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
DOUBLE ENTRY SYSTEM
  • SCIENTIFIC SYSTEM
  • EVERY TRANSACTION HAS TWO ASPECTS.
  • CRUX OF ACCOUNTANCY IS TO FIND OUT WHICH TWO
    ACCOUNTS ARE EFFECTED AND WHICH IS TO BE DEBITED
    AND WHICH IS TO BE CREDITED.

16
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
JOURNAL FORMAT
DATE PARTICULARS L.F DEBIT RS. CREDIT RS.

18
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
CASH BOOK FORMAT
DR. CR
DATE PARTICULARS R.NO L.F CASH BANK DISCOUNT DATE PARTICULARS VR.NO. LF CASH BANK DISCOUNT

20
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 AND FINAL 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
LEDGER
DR CR
DATE PARTICULARS J.F AMOUNT(RS) DATE PARTICULARS J.F AMOUNT RS.

22
Questions.
  • CREDIT BALANCE IN CAPITAL ACCOUNT IS LIABILITY OR
    AN ASSET
  • A. LIBILITY
  • B. A REVENUE
  • C. AN EXPENSE
  • D. NONE OF THESE.

23
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
QUESTIONS
  • WAGES PAID TO RAJU TO BE DEIBED TO
  • A. RAJU
  • B WAGES
  • C. CASH
  • D. BANK

25
QUESTIONS.
  • Q. CREDIT SALES MADE TO ROHIT TO BE DEIBTED TO
  • A. SALES
  • B. PURCHASE
  • C. CASH
  • D. ROHIT

26
QUESTIONS
  • FURNITURE PURCHASED BY ISSUING CHEQUE
  • WHAT ENTRIES TO BE PASSED
  • A. DEBIT FURNITURE AND CREDIT BANK ACCOUNT
  • DEBIT BANK ACCOUNT AND CREDIT FURNITURE
  • DEBIT FURNITURE AND CREDIT CASH.
  • DEBIT BANK AND CREDIT FUNITURE SHOP ACCOUNT

27
QUESTIONS
  • RETURN OF GOODS SHOULD BE CREDITED TO
  • A. SALES RETURN
  • B PURCHASE RETURN
  • C.CUSTOMER ACCOUNT
  • D. GOODS ACCOUNT

28
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
QUESTION
  • WHAT IS JOURNAL ENTRY
  • A. ORIGINAL ENTRY
  • B. DOUBLE ENTRY
  • C DUPLICATE ENTRY
  • NONE

30
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
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
QUESTION
  • PASS JOURNAL ENTRY
  • PURCHASED 100 SHARES OF CENTRAL BANK OF INDIA
    FOR RS.100 PER SHARE.

33
QUESTIONS
  • PASS JOURNAL ENTRY
  • SOLD GOODS TO TENDULKAR RS.15000

34
QUESTIONS
  • PASS JOURNAL ENTRY
  • DRAVID INVOICED GOODS FOR RS.12000 TO US.

35
QUESTIONS
  • PASS JOURNAL ENTRY
  • RECEIVED DUE AMOUNT FROM TENDULAKAR AND ALLOWED
    HIM DISCOUNT OF 10

36
QUESTIONS
  • PASS JOURNAL ENTRY
  • PAID SALARY AND RENT RS.1200 AND 1500
    RESPECTIVELY.

37
QUESTIONS
  • PASS JOURNAL ENTRY
  • KIRAN BECAME INSOLVENT. HE HAD TO PAY 10000 TO
    US. BUT WE RECEIVED ONLY 25 PAISE A RUPEE.

38
QUESTION
  • PASS JOURNAL ENTRY
  • PAID MONTHLY CAR INSTALMENT OF PROPRIETORS
    PERSONAL CAR RS.12000

39
QUESTION
  • PASS JOURNAL ENTRY
  • BOUGHT FURNITURE FROM GODREJ AND PAID BY CHEQUE
    RS.50000

40
QUESTION
  • PASS JOURNAL ENTRY
  • DEPOSITED CASH IN BANK RS.1000

41
QUESTION
  • JOURNALIZE FOLLOWING
  • COMMENCED BUSINESS WITH Rs.15000 OF
    WHICH RS.5000 WAS BORROWED FROM HIS WIFE AT 12
    INTEREST P.A.

42
QUESTIONS
  • PASS JOURNAL ENTRY
  • PURCHASED GENERATOR FROM RAMA CO. RS.50000

43
QUESTIONS
  • PASS JOURNAL ENTRY
  • PAID CARRIAGE AND CARTERAGE ON GOODS SOLD TO
    NAYAN ON HIS BEHALF.

44
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
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 paid during
    that period ,liabilities for unpaid amount
    should be created before the accounts can be said
    to show the actual profit and loss. All expenses
    and income should properly be adjusted through
    accounting entries.

46
Adjusting and closing entries.
  • 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 way
    closed.
  • Now all ajusting enties passed at the time of
    preparing the final accounts have dual effect
    i.e both debit and credit.
  • Hence all adjusting entries passed after Trial
    balance drawn will have two effects.

47
Adjusting and closing entries.
  • 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
Adjusting and closing entries.
  • 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
    account.

49
Adjusting and closing entries.
  • 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 PL Expenditure as they
    do not pertain to current year.

50
Adjusting and closing entries.
  • Depreciation It is fall in value of asset due to
    use or passage of time.
  • Depreciation Dr.
  • To asset account.

51
ACCOUNTING STANDARDS.
  • INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA
    RECOGNISING THE NEED TO HARMONISE THE DIVERSE
    ACCOUNTING POLICIES AND PRACTICES CONSTITUTED AN
    ACCOUNTING STANDARDS BOARD IN THE YEAR 1977.
  • ASB FORMULATE ACCOUNTING STANDRDS SO THAT
    COUNCIL OF ICAI MAY MANDATE SUCH STANDARDS.

52
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
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 ACCOUNTING STANDARDS.
  • D . NO RESPOSIBILITY ON AUDITORS.

54
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.

55
DAY BOOK AND GLB POSTING IN A 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) HAS SUMMARY OF TOTAL TRANSACTIONS IN
    RESPECT OF EACH ACCOUNTING HEAD OF BALANCESHEET
    AND PROFIT AND LOSS ACCOUNT.
  • THE AMOUNT OF EACH OF TRANSACTIONS DONE IN
    BRANCH OF BANK IN THE DAY ARE

56
DAY BOOK AND GLB POSTING IN A BANK..
  • SUMMARIZED AND RECORDED HERE. FOR INSTANCE ALL
    THE TRANSACTIONS IN SAVINGS ACCOUNTS OR ALL
    TRANSACTIONS IN CURRENT DEPOSITS ACCOUNTS ARE
    RECORDED IN SUMMARIZED FORM WITH REGARD TO BOTH
    DEBIT AND CREDIT SIDE. WHICH ARE BROUGHT FROM
    SUPPLEMENTARY BOOKS WHICH ARE AGAIN SUB SUMMARY
    OF TRANSACTIONS IN AN ACCOUNT SAY SAVINGS OR CD.

57
DAY BOOK AND GLB POSTING IN A 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. SIMILARLY FOR SAVINGS ACCOUNT OR
    FURTNIUTE ACCOUNT OR STATIONERY ACCOUNT AND SO ON.

58
DAY BOOK AND GLB POSTING IN A BANK..
  • THE GENERAL LEDGER BALANCE IS VIRTUALLY TRIAL
    BALANCE OF THE BANK ON A PARTICULAR DAY. IT
    REFLECT THE BALANCES OF ALL ACCOUNTS . WHILE
    PREPARING BALANCESHEET 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.

59
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.  

60
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 rules when reporting their financial
    data via financial statements.

61
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES
  • That said, keep in mind that GAAP is only a set
    of standards. What is important that its
    underlying objectives are followed in true
    perspective.

62
ACCOUNTING STANDARDS
  • 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
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
AS-3
  • PREPARATION OF CASH FLOW STATEMENT AND ITS
    PRESENTATION ALONGWITH FINANCIAL STATEMENTS
  • CASH FLOW TO BE CLASSIFIED BY OPERATING/INVESTING/
    FINANCING ACTIVITIES.

65
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
AS-5
  • DEALS WITH TREATEMENT OF PRIOR PERIOD AND
    EXTRAORDINARY EVENTS.
  • DEBITS OR CREDITS WHICH ARISE IN CURRENT YEAR OR
    AS A RESULT OF OMMISSION/MISTAKES IN PRIOR YEAR.
  • ALSO EXTRAORDINARY ITEMS LIKE WRITING OFF
    IVENTORIES.
  • DISPOSAL OF FIXED ASSETS.

67
AS -6
  • DEPRECIATION IS MEASURE OF WEARING OUT ASSETS.
  • DEPRECIATION METHOD SHOULD CAREFULLY BE SELECTED
    AND CONSISTENCY APPLIED FOR YEAR TO YEAR.
  • TREATMENT FOR REVALUATION OF ASSETS
  • DEPRECIATION METHOD TO BE DISCLOSED.

68
AS-7
  • ACCOUNTING OF CONSTRUCTION CONTRACTS .CONTRACT
    FOR CONSTRUCTION EXCEED ONE YEAR OR 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 DETERMINE REVENUE
    RECOGNIZED.

69
AS-8
  • STAND DELETED FROM 1.4.03 RD EXPENSES ARE NOW
    COVERED ON AS-10

70
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
AS-10
  • ACOUNTING OF FIXED ASSETS AND DISCLOSURE THERE
    OF.
  • COMPONENTS OF COST.
  • PURCHASE PRICE IMPORT DUTYTAXESDIRECT COST
    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
AS-11
  • TRANSLATION OF ACOUNTING TRANSACTION IN FOREIGN
    CURRENCIES IN REPORTING CURRENCY.
  • FINANCIAL STATEMENT OF FOREIGN OPERATIONS
  • FORWARD EXCHANGE CONTRACTS.
  • EXCHANGE DIFFERENCE INCLUDED I.E PROFIT OR LOSS
    TO BE DISCLOSED.

73
AS-12
  • GOVERNMENT GRANTS RECEIVED BY AN ENTITY.
  • SUBSIDIES/CASH INCENTIVE/DUTY DRAWBACK
  • DOES NOT INCLUDE ANY TAX EXEMPTION OR TAX HOLIDAY.

74
AS-13
  • ACCOUNTING FOR INVESEMENTS MADE BY AN ENTITY.
  • CURRENT AND LONG TERM.

75
AS-14
  • AMALGAMATION OF TREATMENT OF RESULTANT GOODWILL
    OR RESERVES
  • TAKE OVER OF EXISTING BUSINESS AND FORMATION OF
    NEW BUSINESS.

76
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
AS-16
  • CAPITALIZATION OF BORROWING COST ATTTRIBUTABLE TO
    ACQUISITION/CONSTRUCTION OR PRODUCTION WHERE
    QUALIFYING ASSET TAKES SUBSTANTIAL PERIOD TO GET
    IT READY FOR INTENDED USE OR SALE.

78
AS-17
  • SEGMENT REPORTING
  • REPORTING OF INFORMATION ABOUT DIFFERENT TYPES
    OF PRODUCT AND SERVICES OF AN ENTERPRISE AND
    ITS OPERATIONS IN DIFFERENT GEOGRAPHICAL AREAS.
  • FOR ASSESSING RISK AND RETURN OF DIVERSIFIED OR
    MULTILOCATIONAL ENTERPRISE.

79
AS-18
  • REPORTING OF RELATED PARTY RELATIONSHIP AND
    TRANSACTIONS BETWEEN A REPORTING ENTERPRISE AND
    RELATED PARTY.
  • NAME OF RELATED PARTY AND RELATIONSHIP WHERE
    CONTROL EXIST TO BE DISCLOSED.

80
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 FOR
    A AGREED PERIOD.
  • ACCOUNTING POLICIES FOR LESSOR AND LESSEE AND
    DISCLOSURE IN RELATION TO FINANCIAL LEASE AND
    OPERATING LEASE.

81
AS-20
  • PRINCIPLES DETERMINATION OF EARNING PER SHARE
  • COMPARISON BETWEEN ENTERPRISES.
  • NET PROFI(LOSS)/ WEIGHTED AVERAGE NUMBER OF
    SHARES.

82
AS 21
  • CONSOLIDATED FINANCIAL STATEMENT OF PARENT AND
    SUBSIDARIES.

83
AS-22
  • METHOD OF DETERMINATION OF AMOUNT OF 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

84
AS-23
  • ACCOUNTING FOR INVESTMENT IN ASSOCIATES.

85
AS-24
  • DISCONTINUATION OF OPERATION OF PARTICULAR
    SEGMENT.
  • DISCLOSURE OF PRE TAX PROFIT OR LOSS FROM
    ACTIVITIES ATTRIBUTABLE TO DISCONTINUING
    OPERATIONS.

86
AS-25
  • INTERIM REPORTING WHICH IS NOT FOR COMPLETE
    REPORTING PERIOD.
  • CONDENSED B/S
  • CONDENSED PL
  • CONDENSED CASH FLOW STATEMENT
  • EXPLANATORY NOTES.

87
AS-26
  • OTHER THAN INTANGIBLE ASSETS COVERED IN AS-22(
    DEFERRED TAX ASSETS)
  • RELATE TO START UP COST ( EG ADVT ETC)
  • RD
  • PATENTS AND COPY RIGHT
  • GOODWILL
  • DISCLOSURE USEFUL LIFE OR AMORATIZATION RATE
  • AMORATIZATION METHOD.

88
AS-27
  • TWO OR MORE PARTIES UNDER TAKE ECONOMIC 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.

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
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