BALRAM SANGAL & CO. (Advocates)

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1 BALRAM SANGAL & CO. (Advocates)

2 Registration Delhi Value Added Tax & Central Sales Tax Registration as per DVAT Act, 2004 & CST Act, and Other States. Company Registration Under Company Act, 1956.

3 VAT, CST & ROC

4 Services

5 Financial Accounting Cost Accounting Management Accounting

6 Journal and Journalizing Preparation of Final Accounts From Trial Balance Subsidiary Books Trial Balance Financial Accounting Ledger And Ledger Postings Balancing of Leger Accounts Control Legers

7 Cost Accounting Material Cost Labour Cost Expenses Cost Direct Cost Indirect Cost Direct Cost Indirect Cost Direct Cost Indirect Cost

9 Costs Fixed (Indirect/Overheads) are not influenced by the amount produced but can change in the long run e.g., insurance costs, administration, rent, some types of labour costs (salaries), some types of energy costs, equipment and machinery, buildings, advertising and promotion costs Variable (Direct) vary directly with the amount produced, e.g., raw material costs, some direct labour costs, some direct energy costs Semi-fixed where costs not directly attributable to either of the above, for example, some types of energy and labour costs

10 Costs Total Costs (TC) = Fixed Costs (FC)+ Variable Costs (VC) Average Costs = TC/Output (Q) AC (unit costs) show the amount it costs to produce one unit of output on average Marginal Costs (MC) the cost of producing one extra or one fewer units of production MC = TC n TC n-1

11 Revenue Total Revenue also known as turnover, sales revenue or sales = Price x Quantity Sold TR = P x Q Price may be a variety of different prices for different products in the portfolio Quantity could be global sales

12 Profit Profit (Π) = TR TC Normal Profit the minimum amount required to keep a business in a particular line of production Abnormal/Supernormal Profit the amount over and above the amount needed to keep a business in its current line of production

13 Break Even

Break Even Occurs where Total Costs = Total Revenue Start-up costs fixed costs Running costs variable costs Revenue stream depends on price charged Low

14 Break Even Occurs where Total Costs = Total Revenue Start-up costs fixed costs Running costs variable costs Revenue stream depends on price charged Low price need to sell more to break-even High price lower level of sales required before breaking even Fixed Costs Break-Even Point = Contribution

15 Purpose of Accounts

16 Purpose of Accounts Provide information for stakeholders customers, shareholders, suppliers, etc. Provides the opportunity for the business to monitor its own activities Provides transparency to enable the firm to attract investment Reduces the chance for fraud not 100% successful!!

17 Profit and Loss Account - Flow

18 Profit and Loss Account Shows the flow of sales and costs over a period Shows the level of profit or loss made Shows what has been done with the profit or loss

19 Profit and Loss Account Consolidated Profit & Loss Account for the year ended Weeks Currency million million million Turnover Cost of sales Gross Profit Operating Expenses Operating Profit Other costs/income Profit before interest and taxation Net interest receivable (payable) Profit Turnover Gross Operating Cost Dividend of and Profit Sales other Loss or the Final section the = Net costs the Account revenue turnover Expenses Profit variable and share Subtract expenses of = costs, for earned the interest tax Gross cost British profit due to payments/receipts called the how of over Airways the sales fixed profit much incurred returned get profit year costs it operating cost plc to to on to appropriation get profit get the on profit Source: costs firm before shareholders ordinary ordinary account activities activities after shows to tax produce what before it has tax sold where Retained tax the Profit not the amount to be confused kept with profit/loss sales revenue! is going back for future investment, etc. Profit on ordinary activities before taxation Tax on profit on ordinary activities Profit on ordinary activities after taxation Equity minority interests Profit for the financial period Dividends Retained profit

20 Balance Sheet - Snapshot

21 Balance Sheet A snapshot of the firm s position at a point in time Shows what a company owns (assets) and what it owes (liabilities) Balance Sheet shows what assets a company has (use of funds) and where the money came from to acquire those assets (source of funds)

22 Balance Sheet Part 1 Consolidated Balance Sheet for the year ended Weeks Currency million million million Fixed assets Intangible Assets Tangible Assets Investments Total Fixed Assets Current assets Stock Debtors due within one year Short-term investments Cash at bank and in hand Current Assets: Fixed assets Assets can be tangible assets not that used i.e. are up used in production physical up during items or lasting or longer intangible than one i.e. year production and equipment, brand name, buildings, goodwill. which are likely to machinery, etc. yield cash in the coming year for example, stock will be sold and debtors owing the business money will pay up! Total Current Assets

23 Balance Sheet Part 2 Creditors: Amounts falling due within one year Net Current Assets (liabilities) Total assets less current liabilities Creditors: Amounts falling due after more than one year Provisions for liabilities and charges Net assets Capital and reserves Called-up share capital Share premium Other reserves The Subtracted from And It funds to The can the total come assets those capital from are who the acquire share This leaves us with employed money longer capital these the must term and be Net Assets creditors assets from the company same retained must as owes loans, the have profit to mortgage come (profit sum creditors of from and the on loss net property somewhere account) assets suppliers hence etc for the next term example balance section tells sheet! us where it came from. Profit and loss account Equit shareholders' funds Minority interests Total capital employed

Balance Sheet A guide to the structure of the assets of a company A guide to the level of gearing the ratio of loan to share capital Gives a guide as to the degree of

24 Balance Sheet A guide to the structure of the assets of a company A guide to the level of gearing the ratio of loan to share capital Gives a guide as to the degree of working capital the amount the company has to be able to pay its everyday debts (current assets current liabilities) Shows the total value of a firm at that moment in time

27 Income Tax Tables Individuals, HUFs and AOPs Firms Companies Co-operative societies Tax Deduction at source

28 Source of Income Income From Salaries Income From Other Sources Income From House property Capital Gains Profits and Gains of Business or Profession

29 Sales Tax Refund Registration Amendments Return Objection Online Annexures Online Forms

31 Excise & Custom Conducting All Kind of Customs & Central Excise Work Handling with Govt. Dept. EXIM License like DEPB/Focus Incentive/ Status Registration/ EPCG / NEGETIVE LIST. Duty Drawback AIR/BRAND RATE/RE-EXPORT/EXCISE SAD REFUND etc. Deemed Export Refund (Benefits).Power projects also. EXIM Bank Solution.

32 Sales Tax Income Tax Excise & Custom Service Tax

33 Service Tax Assessments Income Tax Assessments Sales Tax Assessments

34 Audits

35 Thanks You From Sudhir Sangal (Advocate) Contact ; Mobile

Coimisiún na Scrúduithe Stáit State Examinations Commission

2014. M55 Coimisiún na Scrúduithe Stáit State Examinations Commission LEAVING CERTIFICATE EXAMINATION 2014 A C C O U N T I N G - H I G H E R L E V E L (400 marks) This paper is divided into 3 Sections: