We had already discussed the modalities of finalisation of accounts in pre-GST period from 01/04/2017 to 30/06/2017 .Now since the remaining part of the Financial Year 2017-18 will deal with the remaining 9 months hence now we will discuss the details for that period.

a)Opening Balances: Since we had already prepared the balance sheet as on 30/06/2017 hence we will already be having the closing balances as on 30/06/2017 which will be the opening balance as on 01/07/2017

b)ITC as on 30/06/2017 will have to be maintained separately as it can only be claimed if the stock has been sold within 6 months ie upto 31/12/2017 .Any stock if remaining the relevant ITC will have to be reversed which will be termed as

Reversal of Unsold Stock pertaining to PRE GST era on which ITC has been claimed as per GST Trans 1

c)Reversal of ITC arising on account of purchases wherein the payment is still outstanding as on 31/03/2018:

Sec.16 of CGST Act (for a detailed analysis please refer to our post Unpaid Amount ITC

requires that any outstanding amount on account of purchases older than 6 months if remains to be paid then the relevant ITC will have to be reversed.

d)Reverse Charge:

Reverse charge was in vogue from 01/07/2017 to 15/10/2017 hence a detailed summary of expenditure incurred during this period on which no GST has been paid (Meaning if the bill issuer of service has not paid GST) in those cases for the aforesaid period GST liability was that of service receiver hence in all those cases if any liability exists then it has to be paid along with interest.

e)Stock: The beauty of GST is that if everything is in ideal condition then stock will be automatically accounted for.But as we know that GST is not fully implemented as of now hence the department has no perfect details of stock.But in the coming times the details will be definitely matched hence one should be very cautious in maintaining stock.To maintain stock the modus operandi should be as follows:

f)The purchases made should be vouched from purchase bills as well as from party statements

g)The inward stock as ascertained above should be adjusted for all credit notes issued as in GST returns the details of all credit notes issued will be automatically accounted for

h)The outward stock shall be ascertained from sales bill as crossed also from the party statements

i)The outward stock as ascertained above shall be adjusted for all the debit notes issued as in GST returns the debit notes shall be automatic accounted for .

Any wastage should also be accounted for.

One will ask that all these adjustments were also in pre GST era then why so emphasis now.

True it is that these adjustments were in vogue in Pre GST era but then the department had no such readymade information at its disposal so the variance in stock went unnoticed .Now in GST era all the variance will be tracked by the system itself if not now then in coming years.Remember any case can be reopened within 4 years in normal scenario in GST

j)All the additions to assets used in business it should be decided whether one wants to claim depreciation or if wants to claim ITC then the same will be claimed in 60 instalments.This should be declared in the purchase returns in GST

k)All the services which have been availed in the course of business ITC on them should have been availed.

l)Any entries that are generally accounted for at the end of year in PRE GST era will now have to taken care as they arise.This type of transactions covers Incentives,Scheme Discount or any type of incentive given or received during course of business based upon quantum of turnover.

m)any advance paid should be separately checked as initially there was also liability to pay GST on all advance payments received.

n)Even if anything remains on account of ITC then the same can be corrected by filing the annual return under GST by filing GSTR 9 the due date being 31st December for Financial year 2017-18.

The crux is that now one will have to calculate profit and loss and trading account on an ongoing basis.Generally big corporate houses or to some extent the companies run by professionals still do these things but medium businesses and small ones do not do this on an ongoing basis rather they prepare the final accounts once in a year. These will have to adapt new practice or else they will be in a big trouble.






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