CAPITALISTION OF BUILDING

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..... CAPITALISTION OF BUILDING
Query (Issue) Started By: - PANKAJ GUPTA Dated:- 20-5-2014 Last Reply Date:- 19-6-2014 Accounting - Auditing
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Companies Law
Dear Sir, Our unit (manufacturing Company) is under construction on newly land purchased and we have constructed the substantial part (70 percent ) of Building and obtained Occupancy Certificate from concerned department for .....

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..... this part of area in F.Y ended 31.03.2014. Now, our balance area is under construction and this time we have not installed any plant & machinery and planning to purchase machines in current F.Y. 2014-15. We have incurred many expenses in F.Y. 2013-14 and transferred to preliminary expenses. We want to shown our Building construction cost in Capital work in process in B. sheet as at 31.03.14, sin .....

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..... ce we have to capitalized preliminary expenses in Plant & Mach. and Building at the time of Commencement of production and our building to be fully completed till time. Is this mandatory to capitalized Building cost in B. sheet as at 31.03.14 because we have taken Occupancy certificate for that part or we can differed this for next F.Y. Please give suitable reply as per latest changes in depreci .....

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..... ation rules in company act. Thanks & Regards Pankaj Gupta Faridabad M-09212401641 Reply By CA GOPALJI AGRAWAL: The Reply: First of all, no expenses in the nature of preliminary expenses can be carried forward after introduction of AS-26. Second once the building is ready to use, it should be capitalized.
Discussion Forum - Knowledge Sharing .....

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