A Management Representation Letter (MRL) is a formal document issued by a company’s management to its auditors. This letter serves as a written confirmation of the accuracy and completeness of the information provided during an audit. It typically includes statements and assertions about the financial statements, internal controls, and other key areas of the company’s... Continue reading→

LedgerFusion is a user-friendly balance sheet automation tool designed to simplify the preparation of financial statements, particularly the Schedule III balance sheet as prescribed by the Companies Act, 2013. Here are the key features of the Schedule III balance sheet format provided by LedgerFusion: Excel-Based Output Customizable Excel Output: LedgerFusion generates an Excel file with... Continue reading→

The difference between manual and automatic balance sheet preparation lies in the processes, accuracy, efficiency, and the tools used. Here’s a breakdown: Process: Manual Balance Sheet Preparation: Involves collecting financial data from various ledgers, journals, and records. Calculations are done manually, including summing assets, liabilities, and equity. Adjustments for errors, accruals, and deferrals are made... Continue reading→

Depreciation under the Income Tax Act, 1961, allows taxpayers to claim a deduction for the wear and tear of tangible and certain intangible assets used in their business or profession. This deduction reduces the taxable income of the taxpayer, reflecting the reduction in the value of these assets over time. Key Features of Depreciation under... Continue reading→

Ledger Fusion is a versatile tool that can automatically prepare balance sheets for non-Tally data, catering to various formats and software requirements. Here’s how it handles data from different accounting software: Balance Sheet Preparation Formats: Schedule III Format: Suitable for companies adhering to the Companies Act requirements. Non-Corporate Horizontal and Vertical Formats: Ideal for businesses... Continue reading→

Deferred tax refers to a situation where there is a difference between the tax expense shown in the financial statements and the actual tax payable to the tax authorities. This difference arises due to temporary differences between the accounting treatment of certain items and their treatment under tax law. Key Concepts: Temporary Differences: These are... Continue reading→

Consolidating the balance sheet of a head office (HO) and its branches involves combining the financial statements of the main office and all its branches to present a unified financial position. Here’s a step-by-step guide on how to approach the consolidation: Collect Financial Statements Head Office: Obtain the latest balance sheet of the head office.... Continue reading→

Straight Line Method of Depreciation Under the Companies Act The Straight Line Method (SLM) of depreciation is one of the most commonly used methods for allocating the cost of a tangible asset over its useful life. Under the Companies Act 2013 in India, specific guidelines have been established for calculating depreciation using the SLM, ensuring... Continue reading→

  LedgerFusion: Automated Financial Statement Preparation Tool Overview LedgerFusion is an automated tool designed to streamline the preparation of financial statements by integrating with accounting software, primarily Tally, using an ODBC server. It can pull opening and closing balances for the current and previous years and is also compatible with other accounting software like Zoho,... Continue reading→