Retirement benefits and why it is shown in annual report, Financial Accounting

Retirement benefits

1)      Provident fund and family pension:

a.       Contribution to PF and PPF are provided for and payments in respect thereof are made to the relevant authorities.

2)      Gratuity:

a.       Gratuity liability is determined on the basis of actuarial valuation.

The P&L account of the company contains contribution to provident, gratuity and other funds as an expense.

Possible reasons as to why these are shown in the annual report as expenses

1)      The company could possibly get tax benefits by shown showing these items as expenses.

2)      The company may possibly want to indicate the fact that it is taking care of its employees by providing them with these instruments for security of its employees.

3)      The company may have had to provide these because of certain laws of the land, which require it to apportion a certain amount of money for this reason.

Other PMIR related items

1)      It is mentioned that the remuneration of the directors is the basic wages.

2)      It is mentioned that the nature of employment of directors is contractual.

3)      The annexure to the auditor's report says that the Company is generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund and Employees state insurance.

Posted Date: 7/30/2012 8:31:41 AM | Location : United States







Related Discussions:- Retirement benefits and why it is shown in annual report, Assignment Help, Ask Question on Retirement benefits and why it is shown in annual report, Get Answer, Expert's Help, Retirement benefits and why it is shown in annual report Discussions

Write discussion on Retirement benefits and why it is shown in annual report
Your posts are moderated
Related Questions
Illustrations of Changes in accounting estimates B Ltd., bought an item of plant at a total cost of £100,000. The estimated useful life commencing from 1st January 2000 was 10

The key criterion for qualifying as a hedge is that the hedging relationship must be highly effective in achieving offsetting changes in fair values or cash flows based on the hedg

Adjusting Entries Clapton Guitar Company entered into the following transactions during 2013. [The transactions were properly recorded in permanent (balance sheet) accounts unless

Accounting for Partnerships The owners’ interests in the business are divided into long term and short-term interests. (Long-term interests refer to original capital commitment

1. Think about the transactions listed below. a. A company obtains a $10,000 loan from a bank. b. A company purchases $15,000 of inventory from its suppliers. They paid $5,000 toda

I need help on my accounting assignment

a private owned business, pay salary to its employees according to the Ethiopian calendar month to the addis ababa city administration tax authority . Basic salary 3936 ,Normar wor

Q. Define Strong form efficiency? In robustly efficient market finance directors will be alert to the fact that market prices are an accurate reflection of their company's fina

The risk-free rate of return, rRF , is 10%; the needed rate of return on the market, rM, 16%; and Schuler Company's stock has a beta coefficient of 1.6. a.       If the dividend

Q. What is Balance Sheet? Balance Sheet - Basic FINANCIAL STATEMENT, generally accompanied by appropriate DISCLOSURES which describe the basis of ACCOUNTING used in its prepara