 Yes, can we start now and I'm so happy that at least now because yesterday when I came here everyone was just in this mode and I'm happy at least now you're utilizing the objective of the workshop and you're sharing your concern and I know there are two or three points for which even at present even I don't have a solution and those are good points just as I raised here two or three are very good points. Let me work on it. We have a solution. Let me find out. I'll give it to you. A point because I'll share it a bit. Second point which came up during a discussion was about service tax. See taxation is not my field still. I'll check that service tax point and get back. Third, the query was about if any item is less than 5000, can we charge to income expenditure? Earlier, yes, there was a rule in company's act. Now, once I start the presentational pick, I will not go into theory part. I'll pick the major major points which are relevant for us. So, even though 5000 limit B have scrapped, then there was one point. Sir, if we get it approved from the management, then what happens? Sir, I agree. I have to discuss with Bakshi sir because it needs to be changed or revised or amended. Maybe in future, I'll give my suggestion. I agree with me. I don't deny that. I'm just sharing that was given under the company's act. Should be charged to profit loss account. Sir, I'm denying it. I'm giving you a suggestion. Government has designed a performance. We can only say that these are the points which you might want to change in the future. I can only give you points. I know government has designed it but sir, government has designed it. Won't it change even if it is covered with a piece of paper? I don't know sir. If any session is given, then it will change. When the government had made the format, it was made before 2013. So, what did they do? They took the company's act and put it in its provision. That is valid, no sir. Sir, we will have to agree. Why we should change? We should not change. Sir, I'm not talking about change. What I'm saying is that it came from the company's act. So, baby in future, if it comes, I'm just sharing the knowledge with you. Sir, I'm not saying that already if it is less than 5,000, like a pen drive. People even show pen drive also as an asset. Because it is used for the future. But generally what happens when it is a small amount, we have a small amount here, why to create a balance sheet heavy, with small, small items, anything up to 5,000, remove it. In AS 26, I will share it, it is written up to 25,000. Because software is expensive. So, up to 25,000 is written there, charged to PNL account. In intangible. Sir, I'm not changing any format, sorry. I'm not here to change the format. I'm not here to change the format. That is just the knowledge I'm sharing. Let's come into the, I will not go for the meaning part. First thing which generally arises, what are the assets? Because this was a point yesterday as well, whether it is a part of current asset, appreciable asset, fixed asset, tangible asset or not. The appreciable asset has only three criteria, only three. Which is to be used for more than one year. Which is to be used for production or administration. And which is not for resell. Simple. Which is a very common point, everyone knows it. So anywhere if you feel, because there were a lot of queries which were asked during the break also, whether we should charge it, take the example people were asking about e-journals. There was one query from one institution, e-journal, once they take it. They have to renew it every year. Let's suppose I have taken e-journal subscription today. Next year, to get the e-journal subscription again, I will have to pay the money. That was a query from the institution. Then the query was, should we charge that amount as an asset? Should we charge as a deferred revenue or what? I was very clear, even though it's a one-year part. Logically, not from more than one year, right? It will, then I ask one query, can you sell it to anyone? They said no, you can't transfer it. I'm just sharing a bit that point which was asked yesterday. The point was, if let's suppose I have taken for 13-14, then 12-13 archive is given to me. If I pay 14-15, then 13-14 is given to me. Agreed. But for 13-14 amount, I've already paid. There are two types of contract. One is 13-14 only readable. The other is readable and archival. So if 13-14 is both, archival and readable? Agreed. If 13-14 is both, let's say, right? If it is both, are you using it for more than one year? Yes, you're using it. But all assets, all assets have minimum sale value. Can you transfer it? Can you sell it to someone else? No. Any capital expenditure? First of all, we always look at this point, whether it has a saleable value or not. Take the example of a chair. No matter how much a chair is scrapped, still at least you can sell it for 10 rupees. Or 5 rupees. Apart from the criteria of saleable value or whatever, there is another point that out of grants, when we purchase assets out of grants, it is basically whether the grant is for capital asset. Sir, it will come. So for example, if we are purchasing, say, which you are just discussing, out of allocation, the allocation is out of plan grant for books and journals, for example. Right. And the library is maintaining archives. Right. Okay? Now the subscription is on calendar year basis. Right. Okay? So one point is that while making payment for subscription, say for year 2014, a certain part will fall in the current year. Okay. That's not the point. The main point is that over the period, the journals, subscription to journals, which was normally for hard copies, now they have moved to e-journals. Right. Now while making payment for subscription of e-journals, the payment is for, is a form of license to use. Right. It's not that you are, sometimes the license is only for reading only, or whatever. It could be condition. The point is the journal has been subscribed out of plan grant, which is capital grant. The grant allocation of the sanction. You come to your right specific point. Yes. I know what you're talking about. It's a license fee. The point is the allocation or the grant is a capital grant or a non-lickering grant, out of which the decision is making payment for subscription for one year, which has to be taken as a recurring expenditure in the recurring expenditure account. So, the non-lickering grant is used for recurring expenses. The auditor have a valid objection. This is a... One thing I want to tell everyone, that the plan non-plan that we get from the ministry, if we don't connect it with the revenue capital, then there will always be confusion. The plan is always for capital only. Remove this from your mind. We also give salary from the plan. Which capitalizes. So, decide by looking at nature and expenditure. Never keep confusion in the plan non-plan. Sir, if out of plan grant, a certain allocation is made for... Sir, let me tell you two things first. Revenue capital is equal to non-plan. Revenue capital is equal to non-plan. Okay. So, my point is... There is no misallocation. No, sir. The point is, if allocation of certain grant is for creating creation of asset. Okay. That's books, for example. And while utilizing that grant, we come across subscription of journals, which we are archiving. I mean, archiving is maintained, so we are going to capitalize it. We are making... Subscription of journal annual? Yes. Why you will capitalize? We are... No, no. That will not be capitalized. We are making... We are maintaining an archive, the library maintains an archive, and it's maintained over the period. The journals are subscribed by library, which is maintaining an archive. So, we are capitalizing it along with books. Sir, that doesn't happen. I'll come great point. Okay. All right. Okay, I've been saying... No, that's your matter clear. But let me tell you one thing. I've been watching annual accounts for four years. So, plan non-plan. Revenue capital has never been matched. It will always confuse us. Sir, my point is not that. My point is... A non-plan, we always have revenue expenditure. It is not necessary. It is not also correct. We create capital from non-plan. Yes. Sir, that is not my point. My point is, if the allocation is for... for creation of asset. In allocation, where is the asset? In allocation, where is the asset? In allocation, where is the asset? In allocation, where is the asset? In allocation, where is the asset? It is not written. In the plan, the teacher's salary comes. Which asset is created? There are books and equipment in the plan. No, no. You do it there. Okay, I'll tell you. In the plan, it will necessarily create capital. It is not necessary. Sir, you are very good. Thank you. Yes. I am Arula from TIPLA ITM, Iwaliya. Government intention for separating this plan and non-plan is both expenditure that is recurring expenditure and the capital expenditure. Both we can done from plan. The government intention is plan expenditure is only meant for creation of the assets. Whatever assets we are creating, if any salary is paid for the creation of the assets, if the salary is paid for the security staff for looking after the that building which is under construction, that is to be charged to the plan expenditure. This is the intention of the government. That recurring expenditure which is used to be used for the creation of the capital assets, that is to be Don't worry. Plan expenditure. We are here to discuss the point and discuss the point. I'll cover it. Please, sir. Planning commission has already released a classification of expenditure. In that, it says that if any new scheme comes in the plan period during the one planning period like the 5-year plan period if any new scheme is conceived by the government of India then all expenditure related to it whether it is for revenue nature or capital nature all expenditure will be generated in the plan itself. The plan will be charged. This is the intention of the government. Sir, it is like new IIT. Like new IIT is new IIT. Sir, their problem is not related to the plan and non-plan. They have raised a question. Sir, wait a minute. The expenditure heads in the plan are for different buildings for books and journals recurring expenditures. In its bifurcation there is a deal called books and journals. In that, I think it is said that books and journals are given to show in the capitalization non-recreation expenditure. If we take it in the balance sheet in the P&L, in the recurring expenditure then the utilization certificate will be mismatched. Maybe this was it. So clear this. Sir, it is very simple. If you got any grant for books and journals in the plan funds then logically you used it in the plan funds you purchased it from it. But please understand government intention is that you are using it for some purpose. But plan fund and the accounting can never correlate. We have to go by the regulations accounting standards and the concepts. It is very simple. You have taken let's suppose I have taken a land out of plan funds. 100 rupees land and 100 rupees grant. And if I am following a net approach which is given in AS-12 government grant to treat the grant income approach or capital approach. I will be covering it. If I am following an income approach means land 100 grant 100 I will pass a simple entry. Right. Land account debit to capital fund 1 rupee 1 rupee. Finish. Finish. Net. No depreciation even the building, computer anything. I want to say the question was whether the subscription for e-journal or database subscription will be capitalized or not in the accounts. Yes. I can share my experience what we are doing in I am Calcutta is that we see whether the e-journal or database subscription that we are subscribing from the vendor is perpetuity or not. Perpetual or non-perpetual. Perpetual means if the subscription is closed even if we can you know see the back balloon then it becomes a property of the institute and we are capitalizing it. But if it is a non-perpetual kind of thing because for example in the next year if I do not pay the subscription then they will not give us the password and we cannot access the software. In that case we charge it to the revenue. This is our approach. I will take 2-3 examples here. We will come ahead but once you have raised the point let me take 2 or 3 points. One more small supplementary then you can clarify. Under plan and non-plan allocation we receive both kind of components. Capital as well as revenue. The point raised by him is that the allocation for the books is made under capital. Am I right? That is the confusing area. If the allocation is under capital and subscription is for one year only whether that capital fund can be booked under revenue. Please understand. I am just telling this is the confusion. Why? See I agree it was given for purpose of books. Are they ever specifying books has to be for one year, two year nothing? But sir I am telling you capital funds cannot be utilized on revenue item. Sir I agree even I know it but let's suppose when they are giving it to you now you would have an issue. I will take 2-3 examples here. 2-3 examples. Especially in educational institutions nowadays recorded lectures. Recorded lectures are also purchased by both institutions. Along with the e-book if I am purchasing e-lectures e-lectures are also given by number of hours you can view it. If those number of hours are over by one year then logically you cannot show in balance sheet. Reason balance sheet means it has to be a perpetual use. It can be used again and again if any e-journal. Let's suppose I have taken a subscription for any e-book. Right? I have taken through Kindle. Kindle may be free or purchased. I have taken a lot of books for one year. Logically after one year I have to pay again. Take the example of Quickheal. It's a license you get it. They never give you a new CD to renew that license. You have to pay the fees again next year so that money which you have paid doesn't become your asset. But if you have paid let's suppose for a project I am taking example. We have just taken a tally and it's a five year project. The tally, the money was given by the World Bank through the grant. It's a five years. So logically now for five years you can treat it as a like a deferred income also because AS12 permits that. Why you are calling it as a capital? You simple if you want to show in the balance sheet. Show it is a balance sheet. Show e-journal, e-books, library in the balance sheet. Don't use our word capitalization because you can treat it as a deferred income after four years, five years you will have to pay it again. Let's suppose archive ma'am you are talking about archive. You are not paying the fees again for archive. You can use it a number of times that money came from the grant. Certainly it means that now it has become your property. Simple. If you follow the AS12 approach that is a gross approach. Gross means whatever you paid it for a book let's suppose 100 rupees show 100 year. Simple. And it will be depreciated over the years. If you feel that depreciation should be provided but if you feel that no it is a perpetual life like a land. No, don't provide depreciation that. But if you feel no archive is available only for three years it's like a misleading expenditure. Amortize it for three years. Simple logic. So I agree the planned fund is to be used for capital. I agree with it. But if you have purchased it for a book what is capital revenue? Capital revenue is very simple. Revenue is that money which has to be incurred again and again. Every month let's say that's the revenue expenditure. That's the revenue expenditure. I agree sir. Both. But if the plan has books and you have purchased the books and you have to pay the subscription of the book for the next year then even then if the book which will not be usable next year is being shown in the next partnership only because the money from the plan has come it's a wrong treatment. You take as any auditor of CAG they will immediately raise the point. Yes. From plan grants, e-books procurement of e-books for five years or six years now most of the university are procuring e-books. Agreed, I agree. I'll take out very simple part. Right? When we get the grant right? We get 100 rupees grant let's say let's say planned fund. Agreed? That's a simple approach of AS12 which even Anand will take it but you have raised the point I'll be taking it here. Bank and plan funds. Now this bank goes for that you have purchased the e-books. That's like a balance sheet I'm talking about. Simple. Fund will appear at 100. Fund will continue to appear at 100. But what is the logic of fund? Now in your one year balance sheet two year balance sheet three year balance sheet after five years also if you show in this way instead of plan fund you talk about capital fund basically. Right? This is a gross approach. Gross means you are not charging the depreciation. Now let's suppose in this year you say no I want to charge 20 rupees depreciation. The depreciation has to be charged to income expenditure. Over the period of five years it goes. But as ma'am is saying it's archive part so you can use it perpetually. Am I right? Perpetually means it can be used again and again. Again and again. If it can be used if it can be used and again and again logically it is your asset. It should appear but the problem is why you want to show it in 100? The purpose is what? To show the value or to show the asset? Show the asset? As even yesterday Mr. Shyam mentioned the logic is not to show the value here. The logic is to show the asset so that at least if someone comes you can say we have ten archives. That you can say. But over the period of five years, six years any money goes obsolete. Appreciate it. So you want to show it after five years, six years the best approach is always the net approach. First you receive the grant. You pass the entry bank to grant under it. It will show in your balance sheet and like this. Then you purchase the book. You write the entry e-book to bank. e-book. Agreed? Now if you want to charge a depreciation on it you take it five percent, ten percent whatever rate you want to take. Should we charge depreciation on it? Why? Depreciation is what? Whose value will be less? See, how are you reducing the value of the archives? The content will be the same. It will be the same. It is not depreciation I have just mentioned just see the definition of it. Please don't see we are doing this practice. This is a definition of depreciation. Let's see measure of wearing out it's not wearing out. Please you have to being an accountant you have to apply the words also sometimes. Consumption consumption means which you have consumed it cannot be used again or other loss of value. Archive means which has a indefinite life. It means if I have taken one subscription which can be used n number of times it can be used my videos are available on C A Club India if any student purchase it they can only purchase for two years so guarantee two years is a definite curve but if I give the right use exclusively entire life so logically life will be infinite why do you charge depreciation? So books that depreciation income tax that we recover the reason there are many books which are revived changed in all the libraries income tax book is changed every year your I take example I am part day book of financial management you can't publishing always go for revise edition new edition you have a whole edition also available there but tell me if a new edition is available does a student takes the whole edition then what will be the use of this old edition yes if it is not useful then logically that book should be removed but journals are useful even the old articles are referred in PhD and research journals are have a life but not the books if that book e-book you have taken e-book of I am part day right and next year a new edition comes will you take the new edition or not will you take the new edition old edition automatically goes waste and what is the logic of showing it at 100 rupees immediately remove it that is the best approach I am telling you in grants the best approach is never to show on the gross I hope Anand takes that point because if you take the net approach it is the best way your tension of depreciation will be removed and in my presentation it will be covered now now tell me this I will take a very simple example here let us suppose and this guaranteed you guys must be facing it if let us suppose suchiness purchase of Ferrari I have taken a very simple figure suchiness purchase of Ferrari for rupees 100 on 1st January 14 it came to Bombay port and for custom duty he paid 50 rupees on 15 January now it was transferred to his house on 31st January and he paid transportation charges 20 rupees then at his house he installed some accessories of 100 rupees on 15th February car was ready ready for use on 1st March but he used it for the first time there will be many doubts he used it for the first time on 31st May I am again repeating he purchased on which date 1st January amount 100 then it was custom duty was paid 15 January then it was transferred to his house 1st March it was ready to use on which date 1st March he used it for the first time on 31st May in some of the annual report I was looking at it in the accounting policies it is written depreciation has been charged for the full year where the addition is made at any time it is written the policy is somewhere I agreed I am not commenting I am just sharing the points please we are here to discuss so that at least our confusion ever removed now my query is which has in everyone's mind depreciation on which cost 1 is 270 full value full value sir up to 1st March very good it means this year cost concept basically total expenditure very good brilliant my next query depreciation should be charged from which date 31st May very good sir I am not saying yes no please okay 1st March 31st May how many of you are saying 31st May 1, 2, 3, 4 perfectly fine ma'am I agree very good 6, 7, 31st May very good and how many of you are saying 1st March ma'am it should be from 1st March I will tell you wait for 5 minutes wait for 5 minutes you purchase you purchase your AC at your home during the winters because it was economical salesy you got it you use it for the first time in the summers depreciation will be charged because depreciation is about loss of the value it is always charged from the date when the asset is ready to use income tax may allow a please never mix income tax with accounts the basic mistake maximum of us do it we mix income tax with accounts income tax profit is never same as accounts profit cannot be because of the rebate, deduction, exemption can never be same take one more example if I have taken a house on rent and my agreement is from 1st May and I have requested my landlord that I will come back after 20 days will he charge the rent from 1st May or 20th May agreement dated ready to use on a lighter side because the atmosphere has become very hot let me take out on a lighter side a very good joke in this G.P. Sharma ji manager is here and he went with his wife after 3 days 4 days when we checked out from the hotel a very big bill came there was a huge bill which was given to him after 3 and 4 days and the bill was of 2 lakh rupees he was surprised in 4 days a bill of 2 lakh rupees what we have done in 4 days he as the manager manager came manager showed the details of the bill in the bill it was written 80,000 rupees only for AC air condition he said we have come to Ladakh we don't need AC manager said sir see switch it on AC is ready to use you have not used it put to use it but it was ready to use I will charge G.P. Sharma ji said don't worry you are discussing with the CA he immediately took out his letter head and said Mr. manager you are supposed to pay me 20 lakh bill manager got stunned 20 lakh why you have stayed for 4 days why I should pay 20 lakh G.P. Sharma Mr. G.P. Sharma said you have if T is my wife manager got stunned sir I have not touched it G.P. Sharma ji said ask her she is ready to use so always remember its charge from ready to use never put to use ma'am I have taken at least 4 or 5 examples make sure even if you don't use it there was a query from one of the institution that we have not used the asset for 2 years you don't use it its market value will go down there is a loss and depreciation never only means usage loss even if a loss due to time take the example of iPhone if anyone has purchased iPhone now the value is almost like half even if you don't use it even if you don't use it I still remember when I purchased Blackberry I purchased for 25,000 after one month when I went for exchange they said 7,000 rupees I use it only for one month usage say never link depreciation with usage that's the wrong concept sir we get the construction through CQWD the time that the CQWD takes to settle the bills its very long time more than a year or two though the building is ready to use or put to use but they don't hand over the building so normally the ready to use is when the document is transferred when the building is actually transferred to the university but by then the building is already put to use so now depreciation starts at what time maybe sir simple ready to use means when you can shift there until unless all clearances you get it until you can see clearance certificate completion certificate you should not charge it but practically the building is put to use before it is transferred sir agreed it's put to use but it's very simple legal formality it's not like that that's what it takes more than a couple of years to transfer it no problem sir if it's a query but what would you ask for the CQWD clearance for the building just tell me without clearance if you are using it it is basically usage before the construction of the asset it means if you are using it before the transfer then logically it should not be transferred from this from that date I'll take example if you take a car and that car is transferred to your name after one month then you are not the owner you become the owner only after one month no mere saab says it should be charged after one month but how you do it because as statutory audit is putting objection on this they say that though the building is not transferred but since you have already put to use it should be depreciable from the date when you have put to use till the completion certificate will not come it will stay in work in progress and if the completion certificate comes then it will be transferred one thing there is one more logic with it that no maintenance can be repaired even if it is completed then the completion certificate will not come till then there is no repair it is CWIP it is capital work in progress sir our state and work has said that there are 200 casted beams poles 200 casted poles that has to be disposed of because now there is no value means they have shown the book value as zero how we ask that how this book value of the 200 poles be zero they said that because we have designed we have for some experimental work we have designed and now we have to disposed of so it how the depreciated value calculated for these things sir this is revaluation you have to immediately go for the revaluation right now the point is it is exactly same point which in Uttarakhand they have done it if you have taken let us suppose an asset of 100 rupees now if it has to be scrapped demolished immediately then the depreciation concept doesn't apply even immediately have to revalue the asset if they are saying revaluation has been done at 2 rupees 98 is a loss immediately that loss is charged to profit loss account AS6 talks about I will come into it that is the revaluation that generally happens take one more example in 2008 and 2009 Kasab came here right Taj hotel building was almost destroyed so for that period they cannot charge a normal depreciation they immediately check the balance of Taj in that year they have revalued a new building to the actual value because in that year they have incurred a huge expenditure to again manage to again create a new building so in that year it was revalued that revaluation loss was charged to profit loss account and AS6 permits a revaluation permits a revaluation so whenever it is an exceptional case it is never the depreciation you immediately revalue your asset or we are going to revalue it please sir is the computer near about 50 lakhs and its delivery will happen in 30th after that 30th month that is not possible and it is good to use in the month of after that that is going to be that your problem after this related let me take one example the project which I am doing it in that in world bank has given computer to 34 cities but with the condition contract the supplier will installed in all the 34 cities he has installed everywhere but he will right get the money only when he get the certificate of completion from the ULB you have charged make the payment asset is you can start using the asset not installed not installed if not installed then how it will be ready to use take the example of split AC split AC I have got from my home right I have made the payment split AC is lying in a box because the mechanic will come he will put up pipe he will put up fan only then it will be ready to use no there is nothing with the payment sir take the example of LED you have taken an LED for your home one week there was a strike and the mechanic did not come you can't use it ready to use does not means a box it means you should be able to start it sir that completion point we also we central minister Tamil Nadu also facing a similar problem we have been using hostels constructed by CPWD and we are getting hostel fees for the last two years and no details like my other colleague told no details we have received and without the value we are not ready to capitalize so we are showing it as work in progress and it has become a audit query that CAG audit they have written that it is not correct so if completion certificate doesn't we are not we don't have confidence of getting completion ready for at least next two years so still that till that point of time I think we will be able to show it as work in progress in that case it's not reflecting the substance over form actually the real thing is it is a completed building but based on money measurement we don't know the value exactly what is electrical portion or building portion we don't know how to go about this and similarly one more thing is one some DG sets kind of it they have supplied and we are using it for the last four years no invoice nothing has been given so since we have made advance payment as deposit so we are showing it as deposit whereas assets are laying in our permission and we are using it for long so completion certificate if we are not able to get it what will happen I think that is a documentation process I agree going by substance over form what is to be done sir agreed as it's a documentation point and still a statutory auditor is raising the point if I go by the accounting principles logically till you do not get the clearance it should not be capitalized or transferred to asset but if still the audit objection is arising my advice will be as a CA take the approval from the Board of Governors as an exceptional case right as documentation is being getting delayed getting delayed and show the communication that you have at least followed up many times get the approval due to that we are capitalizing it but accounting principle wise unless clearance comes you cannot you cannot that corresponding revenue is there hostile fee we are getting but it is not capitalized without without capitalizing the building we are getting the it's not necessary that is not written by A.G. I agree but it's not necessary that you get the revenue only from the constructed asset even the under construction asset gives you the revenue I can give you a rent even if the partially even the partially rent in AS10 it's clearly written I'll take an example I am getting a building it is under construction right someone comes to me please give me that building for rent for one month I say what you will do he says I just need to as a store house and I said it's not ready he said don't worry I'll pay you money 2 lakh rupees that is what the reply we are given to tackle the A.G. audit right it's clearly given in AS10 any internally generated revenue before acquisition is subtracted from the cost but can we do the best judgment some estimation of the value based on that can we get place the A.G. auditor will never rely on the estimation if till date you have incurred 10 lakh and you are getting a revenue of 2 lakh they will clearly say subtract from your cost subtract the revenue from your cost it means at present if you have not get the clearance till now if you have incurred 101 crore rupees and after 2 years you get the clearance then in 2 years if you get a revenue of 10 lakh in your cost will not be 1 crore that DG set also is not reflected in our fixed assets sorry that DG and other assets what we are using for the last 4 years it is not shown in the fixed assets we are showing it as deficit 2 CPW as per the accounting rules it cannot be and I am telling you show them AS10 I will give you the paragraph the problem is as an auditor when we are not able to justify as a accountant I take an example I was getting the audit done in this ministry itself the C and DG auditor came and they were arguing on the 1 and D for J they were saying no this should be the previous rate I said no that is the rate just see the act they said yes even we are not updating about the service and the income tax rates then they change the paragraph so if you have the justification you show to them yes this is justification still if they make the paragraph I cannot help out but I can only say the right approach the right approach is this that until unless the clearance comes you cannot capitalize it also you see if you will agree but I agree I respect your point because of the audit query you are using it I take one more example most of you must have read in the newspaper in Noida super tech there are two buildings of super tech which has been in which construction has been held by the Allahabad Eye Court now if until clearance comes if the entire building is there let's suppose they have even given the possession also but until clearance comes ownership cannot be transferred ownership cannot be transferred can never be transferred as per accounting rule it is very very clear they have even given in AS 10 that is internally generated revenue that is internally generated revenue actually the possession got transferred sir how you can say its activity is transferred how because it is put to use by the client that is our university sir it is not they are not holding there only documentation detail they are not I will take an example let's suppose sir you sell your house to me you sell your house to me we are friends you say to me please go and ship to my house but the registration process takes 3 months so I will be owner not from today I will be owner only from the third after 3 months in daily DDA allows the flat they have just given the flat and they have given the condition before 10 years you cannot dispose it off if let's suppose my friend has given that flat to me and said you leave it for 10 years I will not be the owner for 10 years owner only when it given to the paper and auditor always goes by the paper sir sir for last session you had told us that we are following the accrual system and on 1st March as we got the assets delivery bill accrual we booked the assets and created the debtors accrual accounting is applicable only for the revenue transaction but sir if we put the deficit on fixed assets accrual accounting is that revenue is earned and cost is incurred so what should we do on fixed assets we should book the payment not payment sir when all the documentation is completed the documentation is completed when the deficit is charged it is the slots 1st April to 30th September and 1st October to 30th March so why we are concerning on the debt issue the slots are given there and half deficit is charged sir what you are saying is only given in income tax income tax act says if you have purchased the asset on or after 1st October charge 50% appreciation if it is purchased on 1st April charge fully depreciation generally we are following the debt system in last 2-3 years yes the problem is sir we follow the income tax approach ma'am rightly said income tax is only relevant we are relying on income tax approach but depreciation is a time based concept sir depreciation comes out month wise day wise if you purchase the depreciation on 15th April so logically for the entire year you will charge it just correct me that depreciation is not time based but I agree in some accounting policies it is written if it is purchased on after 1st October half year depreciation sir income tax is section number 32 we are following the income tax rate generally I mean mainly students are following income tax rate for depreciation we take one as a base and we try to follow everything of that income tax act just for a couple of rates that does not mean you will follow everything of that because otherwise in that we are talking about put to use or income tax profit or accounts profit we are not profitable organization why depreciation is more important to us only for fair value so in the balance sheet so why we are considering on the rate dates and other sir no fair value and if let us suppose 100 rupees is the depreciation cost and you have purchased on 1st April and you should charge for entire year if still you are charging it for half year if you have purchased on 1st July you should charge for nine months if you are still charging it for entire year it is wrong you are showing your higher profit a simple example is your 100 rupees asset you have purchased on 1st April you have charged 100% depreciation I have purchased on 1st July even I am charging 100% depreciation then logically I should have charged for nine months you should have charged for one year if I have purchased even on 30th September still I am charging for one year is it right and you are purchasing on 1st April tell me about house rent you purchased on 1st April I have taken house on 1st September will that rent will be same it can't be but sir last previously we have made the balance sheet 3-4 years back CAJ comes and they have got it on 1st April to 30th September and on 1st October to 30th March sir I you know the problem we take this we have been doing it I agreed you have been doing it I am not saying you are not doing it the purpose of workshop is not what you are doing the purpose of workshop is atleast what are the corrective measures you can take it I know we have been doing it we have been doing it for 20 years 30 years even we have been doing it for last 100 years there was one institution was more than 105 years back load maker I think who came here now right sir please 105 years if they have been following some practice that doesn't mean you won't change it right now if today law gets changed suppose the income tax gets changed do you say this I was paying income tax rate at this rate why a new rate we never say that this is the reason sir the right approach you said fair value why not fair value sir if you take 1st April or 1st September it will change favorably I hope I am clear sir actually all the newly started and other organizations are getting a plan grant it consists of 3 main portions one is capital other one is salary and other one is recurring but non-salary but recurring so entire fixed assets generated by construction of buildings or lab equipment and other things are purchased out of the grant given to us so will it make any difference because according to grant fixed assets purchased out of grant to be shown as 1 rupee value one minute let me just take that