ACCOUNTING TEATMENT FOR DETACTION OF STOCK VARIANCE BY GST DEPARTMENT, Accounting - Auditing

[CABIJENDERKUMAR BANSAL]

hello,

there was search and seizure by GST department for XYZ limited premises. they found physical inventory is not matched with books inventory. physical stock was less then books inventory by ₹ 3 crore and they raised demand for GST , interest , penalty . assesses accept it and paid all dues as per demand.

now query is what is accounting treatment in the books of XYZ ltd for stock to be decrease by ₹ 3 crore.

now

Posts / Replies

[Atul Mehrotra]

Sir, in my opinion, stock will have to be revalued by posting an entry in the general ledger.

Stock revaluation A/c Dr.

To Stock of RM/ FG/ WIP

This revaluation A/c will be charged to the Statement of P&L as expense.