Are you considered following precaution while closing books of Accounts?

closing books of Accounts

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closing books of Accounts

Are you considered following precaution while closing books of Accounts?

In this article we are trying to help you for closing your books of Accounts, so that you can closed your books before march with more comprehensive and in correct manner without any omission of any provision of the laws.

  • First bill in new year:

Precaution needs to taken while issuing 1st bill in coming year.Following are slabs on the basis of which taxpayers requires to mention HSN

  • -if turnover is > Rs. 5 crores shall use 4-digit code
  • – if turnover is < Rs. 5 crores but >1.5crores shall use 2-digit code
  • – if turnover is < Rs. 1.5 crores are not required to mention HSN Code in their invoices
  • Returns frequency:

On the basis of turnover for the year 2017-18, returns frequency in the next year will be decided.

  • -if turnover is < Rs. 1.5 crores – Quarterly returns
  • -if turnover is > Rs. 1.5 crores- Monthly returns
  • Deprecation on Fixed Assets:

If the taxpayer has availed the ITC on fixed asset(other than Building), tax portion needs to ignored at the time of calculating deprecation.

  • Compliance’s in the form of Returns:

On the basis of final accounts of the March month, following returns will be filled:

  • – GSTR 3B for March is to be filed up to 20th April.
  • – GSTR 1 is to be filed up 10th April.
  • – GSTR 4 is to be upto 18th April.
  • – GSTR 6 is to be filed up to 13th April.
  • Switch over from the Existing Scheme:

If the taxpayer wants to switch over from regular to composition scheme then he can apply in Form GST CMP – 02 before 31st scheme then he can apply in Form.

  •  – Similarly those who wants to cancel the registration under composition scheme, they have to apply in Form GST CMP – 04 before 7th April. Also they have to calculate the effects of ITC on closing stock.
  • Closing stock valuation:

While valuating closing stock the input tax credit taken on raw material, consumables,semi-finished goods is to be calculated.

  • Last month for filing TRANS-2:

 The taxpayers who have filed the TRAN 1 and have taken the credit of Excise duty paid, without any documents, they have to file the details of outward supplies for six months in TRAN 2 before 31st March 2018 for availing 40%/ 60% credit.

  • E-Way Bill:
  • -From 1st April, 2018 onward, It is compulsory to issue E way bill for inter state transport.
  • -In case of inter-state supply, the goods are in transit as on 1st April, 2018, it is compulsory to generate e way bill for them. Therefore, it is necessary to take the registration under E way bill system before 31st March.
  • Reconciliation of the Book balances:
  • -Check whether one expenses ITC is not taken in GST returns.
  • -It is necessary for the taxpayers to reconcile the balances of Cash, Credit & Liability ledger with the books of accounts.
  • -All the entries should be passed before the year.
  • -Also match the Credit & Debit Notes with the Purchase & Sales.
  • Reversal of Credit:
  • – if receiver does not made the full payment of amount within 180 days after issuance of tax invoice then the credit taken on that invoice is to be reversed.
  • -Whenever the payment is made, the receiver can take the credit of the amount. Therefore the aging analysis of the debtors and creditors is to be done.
  • – All old invoices issued before 1st October, 2017, should be paid before 31st March 2018.
  • Input service Distributor:
  • This is the last month for the ISD to Complete his all GSTR-6 from the period July-2017 to February-2018.
  • Due date of filling the returns is 31st March-2018.
  • Comparative Analysis of Ratio:
  • -Taxpayer should check whether he is trapped in the Anti profiteering or not, by doing the comparative analysis of Gross Profit Ratio profit earned for March 2018 with the gross profit of financial year 2016-2017 or gross profit for April 2017 to June 2018.

Hope this article will be helpful to you while closing Financial Books of Accounts.

-CA Monika N Rathi


About Author

CA Monika Rathi

Name: CA Monika N. Rathi

-The author is Chartered Accountant and she working as a partner in the M/s SSRPN. & Co.

 

 

 


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