Prior Period Items, Income Tax

[sathyanarayanan kasinathan]

The Auditor has classified a set of expenses as 'Prior Period Items' which accordingly goes to reduce the profit. What is the treatment of 'Prior Period Items' in Income Tax?

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[GOPALJI AGRAWAL]

Prior period items are income or expenses which arise in the current period as a result of errors or omissions in the preparation of the financial statements of one or more prior periods.There is no such notion permitted in Income tax. If the amount is substantial, then the assessee may revise the return of earlier if within time limit. These are not allowable in the current year.