Exam Of Bookkeeping For Lands Plus Structures – Accounting Together with Tax MethodologyExam Of Bookkeeping For Lands Plus Structures – Accounting Together with Tax Methodology
Land can be labeled in individual classes and accounts: bare land (no buildings), land with personal properties land with structures of third parties and land with layers. Structures consist of installations, repair, variations and infrastructure.
Auditing of “Lands” and “Building projects” has the pursuing major objectives:
– Make positive of the material existence of this kind of belongings
– Affirm whether the firm is the real operator of its personal property
– Make certain that assets have been assessed and registered in the balance sheet according to their correct benefit
– Contemplating their routine maintenance problem and age, attract related conclusions with regard to justification of depreciation measures as nicely as depreciation quantity and fee applied:
– Make certain that acquire and transferals of fastened assets are mirrored in the bookkeeping by way of relevant registrations
– Assess the threats to possession of set assets (e.g. fire) and examine them with insurance policy packages signed.
Accounting and technical recommendations
Auditing contains at least the subsequent:
– Check out the justification of property on land and other immovable property, house titles, cadastral registers, house loan registers and acquire contracts on the day of stability sheet
– Every mounted asset in this part must be crosschecked and correspond with: buy value, cadastral assessment, insurance coverage benefit, accounting value, mortgage alienation benefit, product sales benefit, manufacturing benefit (actual or theoretical), replacement benefit, price from evaluation and tax stories
– Remark on background of figures for all alterations taking place in the respective accounts of these investments
– Analyze each and every indicator or factor related to accounts for lands and structures and choose regardless of whether alterations must be considered as investments or utilization charges
– Commence with website visits in order to observe any new installations or damages for the objective of crosschecking them with respective costs in the bookkeeping
– Discover eventual non-occupied regions
– Ascertain the growing older situation and routine maintenance of structures and crosscheck with amortizations created till the instant of audit
– Make sure that essential amortizations have been correctly created, in conformity with related regulations and rules and verify calculations created for these amortizations
– Consider potentials for fraudulent bookkeeping: unjustified obtain at very higher cost, unjustified sale at really low price tag, inclusion of utility expenses in fixed property or vice-versa, free-of-demand lease contracts, free of charge-of-cost contracts for 3rd events, use of firm installations for personal needs, deviations between actual price, registered price and the cost in the authentic act
– For new buildings, check the genuine value, eventual destruction charges and verify whether very best provides have been noticed
– Look at how the price of properties is decided and whether staff wages are entered in the bookkeeping
– Make confident that values have been modified to mirror changes in substitution value
– Detect situations when rates have been hidden in notary functions
– Examine methods used so that each and every investment decision obtain is right away lined by insurance policies packages
– Look at bookkeeping for damages in the structures
– Examine commissions and payments to intermediaries during obtain of lands and properties
– Examine actions to maintain fixed property in very good situation to ensure their greatest use (servicing companies, periodic inspections, and so on.)
– Verify for actual insurance coverage, home loan, pledged by the company which impact land or immovable home. If sure, examine the guaranties used and at minimum check out: the mother nature of guaranties, mother nature and amount of commitments guarantied and beneficiaries
– In the annex, point out adjustments in land and immovable home occurred in the course of audit
Specific interest must be devoted to accounting treatment method of set property in this area:
a) Accounting treatment for land acquire and sale
one. When land is entered in a company’s assets, the price is debited in account 211 “Land” as contribution price, obtain cost or credit score respectively in account for “principal belongings (individual or team one) or in the account “Companions account for contributions in the organization” or “Suppliers of fixed belongings”. Account 211 registers the value of land owned by the business. It is essential to distinguish in between independent accounts, dependent on the character of element components of fastened property:
– Bare lands (no properties)
– Enhanced lands (with channels, and so on)
– Underground and previously mentioned soil: terms employed when the business is not the proprietor of the a few elements connected to the exact same element of terrain: land, underground and earlier mentioned soil
– Exploited lands (carriers, mineral layers) which are the only elements matter to depreciation
– Household terrains with a single much more buildings.
2. For the duration of revenue, the price of origin for elements offered and that of amortization, if any, are taken from the respective accounts. Their web sum is debited to account 652 “Accounting price of components for mounted assets sold” at the identical time, account 752 “Incomes from components of set property marketed” is credited in the debit of account 462 “Request to receive from mounted property offered”. Provisions are shut in credit rating of the respective subdivision of account 78 “Reacquisition of amortizations and provisions”.
konsultan pajak bandung ) Accounting treatment of sale-obtain operations in design
In case a construction is bought for a price which does not separate land price tag from creating price, only the constructing price tag portion is matter to amortization. As a result, when a company purchases a constructing, we need to make certain whether or not it has divided the worldwide purchase expense in percentage with the relative worth attributed to each of the two components (account 211 “Land” and 212 “Developing” in the complete price of immovable home).
one. When buildings are entered as company home, account 212 “Properties” or its subdivisions are debited:
– For incoming benefit,
– For acquire price,
or for the actual cost of property production, in credit of:
– Account one zero one “Principal belongings (principal or personal)” or account 4561 “Associates – Account for contributions in culture”,
– Account 404 “Suppliers of fixed property or other respective accounts,
– Account seventy two “Production of fastened assets”.
2. In case of income, the price of origin for properties marketed and respective amortizations are taken from their respective accounts. Their big difference is debited to account 652 “Accounting benefit of elements for set assets bought” at the very same time, account 752 “Incomes from factors of set assets sold” is credited in the debit of account 462 “Request to obtain from fastened assets bought”. Provisions are closed in credit of the respective subdivision of account seventy eight ” Re-acquisition of amortizations and provisions”.