What happens if A/P on a cash basis shows a huge amount. Shouldn't be zero?

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k.venkat ramana

  • Mar 21st, 2007

As per income tax rules we cannot pay A.P more than 20000/- at single payment
and also from 01-04-07 it has came to know that expenditures exceeding 20000/- cannot be treated as a expenditure in P&L A/C

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The A/P department people will take certain limits and measures. They are
1. Aging invoice
2. Is there any disputes
3. Discrepancy's
Generally Invoices may be paid at the terms and conditions and the same time A/P people try to fully utilise the days, discounts, interest and others

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