Mumbai – Even before the country could recover from the initial impact of GST implementation; there seems to be new tremor for the auditors. Those who are into auditing would be faced with new challenges from GST impact on the accounting.
If the experts’ are to be taken seriously, due to the differences between tax under GST and the erstwhile taxation, the revenue of different organization might get affected. It is revealed that the treatment that GST has on a sale of items differs from the excise duty. This tax on manufacturers had a separate effect and considered as a part of revenue.
The GST officials have said that at the time of sale, the amount of tax which the company would collect from the consumer would not be included in the revenue report as the amount would be remitted to the government.
Research conducted recently revealed that the companies have enjoyed a hike in the revenue under the IND AS. However, this would again see a drop with the implementation of GST. The excise duty would be ineffective now that GST has been implemented.
Though the net income of the companies would not be affected by this, the impact would be felt by the accountants as they would be burdened with the various ratios.
Additionally, the compensation, which the companies used to pay to the dealers, would also be treated differently. There are companies which would gladly pay the dealers just to reimburse the additional tax.
The glaring question, now is – how such tax could be accommodated in the Ind AS result.