Financial analysis, the process of accumulating, envisioning, controlling, deciphering, and anticipating financial data and following the aim to evaluate the financial accomplishment of a particular department inside a company or…
As per Ind AS 108, Identification is based on 3 criteria. That is any operating segment should have 3 characteristics. Component of entity for which discrete financial information is available.…
1. Pan Card 2. Aadhar Card (linked with Pan) 3. Form 16 (Part-B) in case of Salaried Person 4. Bank Statement in case of Salaried Person 5. Books of Account…
The major factors that are considered in selecting and retaining an auditor include the size of the audit firm, the status of ongoing auditor engagements, the cost of the auditor…
As per IND AS 12, deferred tax asset is recognised for all deductible temporary differences to the extent that it is probable that taxable profit will be available against which…
The notes shall: (a) present information about the basis of preparation of the financial statements and the specific accounting policies used in accordance with paragraphs 117–124; (b) disclose the information…
“The amount set by the auditor at less than materiality for the financial statements as a whole to reduce to an appropriately low level the probability that the aggregate of…
Many online Advertisement portals are non-resident and do not have permanent establishment in India. Many resident assessee make payment to this non-resident for advertisement and claim as business expenditure u/s…
Supreme Court's Landmark Judgement on Income Tax Exemption for Profit Oriented Educational Institutions (trust or societies etc.) Supreme Court overruled two previous judgements - Profit Oriented Educational Institutions (trust or…
Sec 147 : Income escaping Assessment or Reassessment If any income chargeable to tax, in the case of an assessee, has escaped assessment for any assessment year, the Assessing Officer…
Faceless assessment means carrying out of income tax assessment procedure without human interface with the use of technology. The Cases shall be assigned to the department through automated allocation system.…
As Amended by Finance Act, 2022 INTRODUCTION Finance Act, 2021 introduced major changes to the provisions of reopening of assessment of an assessee for previous assessments years. Erstwhile Sections 147…
Advance tax means tax paid in the financial year immediately preceding the A.Y. (i.e., PY) As per section 208, every person whose estimated tax liability for the year is Rs.…
The DRP is an Alternative Dispute Resolution (ADR) mechanism for resolving disputes related to Transfer Pricing in International Transactions. Appeal can be filed before CIT(A), when an assessee is adversely…
Internal transfer pricing is pricing mechanism of the organisation under which one division of an organisation charges for the product or service transferred to another division of the same organisation…
Many online Advertisement portals are non-resident and do not have permanent establishment in India. Many resident assessee make payment to this non-resident for advertisement and claim as business expenditure u/s…
Double taxation means the same income getting taxed twice in hands of same assessee. Any country taxes income on baris of two rules i.e. residence rule & source rule Double…
An advance ruling refers to the facility of obtaining a judgment in advance from the Authority for Advance Rulings. The facility is used when the assessee has anticipated contentious issues…
“Place of effective management” means a place where key management and commercial decisions that are necessary for the conduct of business of an entity as a whole are, in substance…
The agreement is between the Board and a person. The principle to be followed in case of merger and demerger is that the person (company) who makes the advance pricing…
a] Primary adjustment is defined to mean the determination of the transfer price in accordance with the arm’s length principle resulting in an increase in the total income or reduction…
Arm’s Length Price can be computed by the following methods; 1. Comparable Uncontrolled Price Method 2. Resale Price Method 3. Cost Plus Method 4. Profit Split Method 5. Transaction Net…
Realized gains refer to profits from completed transactions whereas unrealized gains refer to profits that have materialized, but the transactions have not been completed. Realized gains are the profits earned…
Ensure the accuracy of the data entry process, which involves journal entries of financial transactions and the posting of journal entries to the ledger which can be done by Automated…
Debt extinguishment occurs when a debt instrument is terminated. This occurs when the borrower repays the lender or bonds are retired by the issuer. Extinguishment may not involve full repayment…
Debt covenants can simply be defined as agreements between the business and the creditors. Under this, the borrowing company is supposed to abide by certain conditions, in order to be…
So long as you use accrual accounting, cash flow statements are an essential part of financial analysis for three reasons: They show your liquidity. That means you know exactly how…
There are two ways to prepare a cash flow statement: the direct method and the indirect method: Direct method – Operating cash flows are presented as a list of ingoing…
Basic Earnings Per Share is the ratio, that is reckoned to know the earnings available to each equity share. It is calculated by considering company’s ordinary shares. On the other…
Virtual certainty determination is a matter of judgement to be evaluated on a case to case basis , should be supported by convincing evidence, i.e., evidence available at reporting date…
A walkthrough test is an examination of each step involved in a transaction. A transaction is traced right from the beginning to the end to understand the process flow A…
(1) It is a written statement by management provided to the auditor to confirm certain matters or to support other audit evidence. (2) It does not include financial statements, the…
We need to perform alternative audit procedures to larger items- By verifying the subsequent cash receipt to see if customers have paid for those invoices that were not confirmed, sales…
The auditor should evaluate whether Sufficient and appropriate audit evidence has been obtained and conclude on appropriateness of management use of going concern basis of accounting in preparation of Financial…