10-07-2010, 12:24 AM
Dear
Sponsors (even if they are not subsequently the directors) can be remibursed all costs they borne in connection with incorporation of the Company.
You need not to credit "Loan from Directors account" if you have funds currently (after incorporation of the company) and you wish to reimburse such expenses after getting required approvals from shareholders/BOD. You can simply debit the expenses and credit the bank while making payment.
If payment is to be made at a later stage you can simply credit "Payable to Directors" in current liabilities.
All incorporation expenses of the Company have to be expensed out in profit and loss account. Now, there is no concept of deferring such expenses. However, IFRSs allow that the expenses specifically incurred in connection with issuance of share capital only can be shown as a deduction from Issued, subscribed and paid-up capital in the balance sheet instead of charging to profit and loss account.
Regards,
Sponsors (even if they are not subsequently the directors) can be remibursed all costs they borne in connection with incorporation of the Company.
You need not to credit "Loan from Directors account" if you have funds currently (after incorporation of the company) and you wish to reimburse such expenses after getting required approvals from shareholders/BOD. You can simply debit the expenses and credit the bank while making payment.
If payment is to be made at a later stage you can simply credit "Payable to Directors" in current liabilities.
All incorporation expenses of the Company have to be expensed out in profit and loss account. Now, there is no concept of deferring such expenses. However, IFRSs allow that the expenses specifically incurred in connection with issuance of share capital only can be shown as a deduction from Issued, subscribed and paid-up capital in the balance sheet instead of charging to profit and loss account.
Regards,
