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Nitra S.K.

Croup of Companies
Accounts Manual
Some basic rules :
Ixponsos shouId bo groupod oIfhor In ÐIrocf
Ixponsos or IndIrocf Ixponsos
SnIos í AnnIvsIs Chnrgos In our cnso) shouId go undor
ÐIrocf Incomo & nnv ofhor Incomo shouId go undor
IndIrocf Incomo
AII IIxod Assof Ifoms shouId go undor undor IIxod
Assof
AII Curronf Assof Ifoms shouId go undor Curronf Assof
!onn CnpIfnI or Iorrowod CnpIfnI shouId bo shown
sopnrnfoIv undor !onn Accounf
AII Curronf !InbIIIfIos Ifom shouId go undor Curronf
!InbIIIfIos
Infor Irnnch frnnsncfIons nnd fhnf wIfh H.O. shouId
go undor Irnnch / ÐIvIsIons
#rofit S Loss Account !tems :
Expenses :
We use very few no. of heads. The details of which are as bellow:
(i)Direct Expenses :
a) Acid S Chemicals
b) Cas Charges
c) Nisc. Laboratory Expenses
d) Salary - Sampling
e) Salary - Analytical
f) Sampling Expenses
g) Transport Charges , etc.
h) Survey Charges
We will now discuss the expense heads in detail
Direct Expenses :
a) Acid & Chemicals - all the purchases should be taken inclusive
of the purchases of the month of March of the Financial year
for which the payment is not paid within the F.Y.
b) Misc. Laboratory Expenses - All Laboratory expenses like Gas
charges , OT , Meal , Tiffin of Lab. Staff , Casual Lab staff
salary, items purchased on a regular basis for Lab. Use which
is of small value , and any other expenses related to Lab.
c) Salary Sampling - Salary of Permanent Field Staff
d) Salary Analytical - Salary of Permanent Lab. Staff
e) Sampling Expenses - Wages , OT , Meal , Tiffin to Casual
Labour & Staff, Sampling carrying items , Items directly
related to sampling work , any other items which is directly
related to sampling , amount paid towards entertainment
f) Transport Charges - Transport charges of carrying samples &
also goods of employees for shifting
!ndirect Expenses
a) Advertisement - all expenses related to advertisement S publicity
b) Analysis Charges ( Out) - all related expenses
c) Audit Fees ( E!C ) - All expenses related to E!C Audit
d) Bank Charges - Bank commission S Charges
e) Books S #eriodicals - ]ournals , newspapers , other books , etc.
f) Business #romotion - All expenses related to developing business
g) Charges general - revenue stamps , other expenses of small amount
not related to any specific head
h) Company's cont. to #.F.
i) Company's cont. to E.S.!.
j) Consultancy Fees - payment to any consultant
k) Conveyance - Local conveyance S Car hire charges ( input service tax
entry should be made and should tally with the list provided)
l) Courier Service Charges - payment to courier co. ( input service tax
entry should be made and should tally with the list provided)
m) EDL! Administration Charges
n) EDL! Cont.
o) Electricity Charges
p) Establishment ( Salary ) - Salary to #ermanent Office Staff
8. Fax Charges
r. !nsurance - all expenses related to the F.Y. should go to !nsurance ,
all prepaid insurance should go to prepaid exp. Under current assets (
input service tax entry should be made and should tally with the list
provided)
s. Legal expenses - All exp. Related to legal matters
t. Nedical S Sanitation - Washing charges , sweeper wages , mineral
water, phyneol , medical treatment , etc.
u. Nembership Subscription
v. Notor cycle expenses - Repairing , servicing S Fuel Charges
w. Notor vehicle expenses · Repairing , servicing S Fuel Charges
x. #ostage S Telegrams - Speed #ost , #ostage Stamps , etc.
y. #rinting S Stationery - Stationery items
z. #rofession Tax - #rofession tax of Company only
aa. Registration Charges
bb. Rent - Office Rent , and house rent paid to the land lord of employees
cc. Repair S renewals - All types of repairing , building , machinery ,
furniture , electrical , etc.
dd. Retainership fees
ee. Staff insurance - Nediclaim insurance
ff. Staff welfare - all welfare related to staffs
Taxes S Licenses - Taxes related to corporation , etc.
Telephone charges - ( input service tax entry should be made and
should tally with the list provided)
Tender Fees
Traveling Expenses
Some important matters
1. TDS - TDS deducted at H.O. , net amount sent to Branch towards
payment to contractors or professional or landlord :
RULE :
At branch :
Expense account .... Dr. ( Full amount of Exp.)
To ,
TDS
To,
H.O. ( if amount is sent from Kolkata) / Bank / Cash ( Net amount )
At H.O. :
. Branch account ...... Dr. ( Net amount) ( !f amount is sent
from Kolkata)
To,
Bank
2. TDS Account .......Dr.
To,
Bank
. !nput Service Tax - !nput service tax on expenses like telephone ,
insurance , courier service charges , survey charges , Legal S #rofessional ,
Contractors , Car hire charges , ANC , etc.
At H.O. S Branch :
Expense account ..... Dr. ( amount excluding service tax)
!nput service tax ......Dr.
To,
Bank / Head office
. Salary - Cross salary should be debited and only one voucher
towards the salary should be made showing all the deductions
details
Direct !ncome :
Our main head is Analysis Charges
!ndirect !ncome :
Any indirect income like insurance claims received , etc.
Scrap sales should go under the indirect income and subject
to TCS. !f we do not charge TCS on scrap sales then it
should be shown differently like crediting a expenditure
head. Any charges recovered from employees towards the
expenses made should be credited to respective expense
head , not in the indirect income.
Balance Sheet :
Fixed Asset :
Fixed assets are classified by us into the following categories :
1. Air Conditioner S Refrigerator
. Building
. Computer - includes #rinter also
4. Crusher Shed - #lease specify whether permanent or Temporary
S. Cycle
6. Electrical fittings - includes all electrical items and Fans
7. Furniture S Fixture
8. Laboratory E8uipment
3. Notor Cycle - includes all the cost !.e. insurance , tax , other exp.
Related to first time
10. Notor vehicle - includes all the cost !.e. insurance , tax , other related
exp. for the first time
11. Office E8uipment - includes items like water filter , voltage Stabilizer ,
#rojector, Copier , Calculating machine, etc.
1. Telephone !nstallation - Land #hone , Nobile , Fax machine , data
Card , etc.
Comments:
#lease maintain the abovementioned heads
Don't debit the nomenclature ¨Fixed Asset"
Do the following:
Name / Category of Fixed Asset ....Dr.
To,
Bank / H.o.
Note :
1. All related cost of a particular asset incurred for the installation
and / or for the first time should also be included in the cost of
that asset.
. Excise duty if mentioned in the bill and paid , S0% of it should
be taken as input credit for the current year and S0% of it
should be taken in the next year.
. Any sale of assets should be specifically mentioned.
Current Assets Loans S Advances :
CURRENT ASSETS :
1. Sundry Debtors
. Bank Account - Send all the bank statements within time. Any amount
received from parties and deposited in HDFC Bank , the entry will be :
!n Branch ( which does not have HDFC Bank account ):
H.O. Account ... Dr.
Advance !ncome Tax (TDS) A/c .. Dr.
Security Deposit/Retention money/ any other deductions made .. Dr.
To,
Party ( from whom amount received
!n H.O.
HDFC Bank Account ···· Dr.
To,
Branch ( in respect of which the party released the payment )
. Cash - in - hand - #roperly show the withdrawal from bank and
disbursement of the same
LOANS S ADvANCES :
1. Security Deposit ( Security deposit with party or other statutory body
should be debited to security deposit for that account only e.g.
!f security deposit is with #arties
Security deposit with parties A/c ... Dr.
To,
Bank
!f Security deposit is with others
Security deposit for rent / electricity A/c .... Dr.
To,
Bank
Note : Refund of security deposit from parties or others
Bank A/c ... Dr.
To,
Security Deposit with parties / Security deposit for Rent
/Electricity
. END - Same treatment as Security Deposit
Note : No amount of security deposit or END refund should be
credited to Party Account
. Other Deposits - with various authority - treatment is same like Security
deposit
4. Advance against Traveling - Create a group and maintain separate ledger
within it for each one who has taken the advance , make sure the
details of expenditure has been obtained during the financial year.
S. Advance against salary · same as above
6. Advance !ncome Tax ( TDS ) - #roperly mention the TDS in the voucher.
Also send the list on monthly basis.
7. Other Advance - Advance for rent , Service Tax for input credit , #repaid
Exp., etc.
Loans :
Loans taken for various items like machine , car etc. should be properly
accounted for.
!f loan is taken for purchasing the Nachines / car :
Nachines / Notor vehicles Account .... Dr.
To Loan from ....
The EN! of the loan should be segregated into interest portion S principal
portion. The entry will be :
!nterest on Loan account .... Dr. ( interest portion)
Loan from .. ....Dr. ( #rincipal portion )
To,
Bank
Note : The balance in the loan statement should tally with the
ledger. Loan statement should be sent at the end of the year to the
accounts Dept.
Current Liabilities :
1. Liabilities for Expenses - All liabilities - the payments of which has not
been made during the financial year should be included here by
debiting the respective expenses heads and crediting the liability for
expenses head which should tally with the list of liabilities provided by
the accountants. All payments of the liabilities of earlier years should
be debited here.
. Statutory Liabilities -TDS deducted from parties if any, should be
credited. All other statutory deductions from employees should be
credited. All statutory payments should be debited by debiting the
respective statutory liability head.
. Other Liabilities - advance from customers , if any to be included here
4. Sundry Creditors - Supplier of any items the bill of which is due on
the last day of the accounting year should be credited , the list of
which is to be given separately.
Some Key Rules :
1. Do not mix up capital expenditure items S revenue expenditure items.
!f this mistake is made then it will not show true profit / loss position.
. Do not credit parties account with amount of security deposit or END
refund
. Take all the costs for the first time related to purchase of a particular
fixed assets and also any improvement cost of fixed assets to that
particular asset account
4. Do not debit expense with the amount of liability of the earlier years
Ceneral Heads used :
Assets
· Croup :
· Fixed Assets:
· Ledgers:
· Air Conditioner S Refrigerator
· Building
· Computer
· Crusher Shed
· Cycle
· Electrical fittings
· Furniture S Fixture
· Laboratory Equipment
· Notor Cycle
· Notor vehicle
· Office Equipment
· Telephone !nstallation
Current Assets Loans S Advances
· Current Assets :
· Croups :
· Sundry Debtors
· Bank Accounts
· Fixed Deposits
· Cash·in·hand
· Loans S Advances :
· Sub·groups :
· Security Deposit
· END
· Advance against Traveling
· Advance against salary
· Advance !ncome Tax (TDS)
· Other Advances
Current Liabilities :
· Croups :
· Liabilities for Expenses
· Statutory Liabilities
· Other Liabilities
· Sundry Creditors
Branch / Divisions
Create separate ledger for each branch and also for H.O.