What are the advantages of the withholding tax system for taxpayers?
A. It reduces the burden on taxpayers who would otherwise have to pay considerable amounts within short periods.
B. It is the most effective and inexpensive way of collecting taxes for the tax administration.
C. It ensures a regular flow of revenue to the government.
D. It is a useful instrument in encouraging voluntary compliance.
E. It helps to minimize tax evasion and is especially effective In areas where it is difficult or uneconomic to detect evasion if payments were not taxed at source.
What are the includes in "Borrowing cost" in accordance with SLAS 20?
A. Interest on bank overdrafts and short term and long term borrowings.
B. Amortization of discounts or premiums relating to borrowings
C. Amortization of ancillary costs incurred in connection with the arrangement of borrowings.
D. Exchange difference arising from foreign currency borrowings to the extent that they are regarded as an adjustment to interest costs.
How can we recognize 'Borrowing cost' in the financial statements?
A. Borrowing cost shall be recognized as an expense in the period in which they are incurred.
B. Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset shall be capitalized as part of the cost of that asset.http://lahirumanagement.tk/,http://www.carterdecosta.com/
Assignment 11
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Lahiru Yapa
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How can we explain the concept of "ACCRUAL BASIS"?
Under this basis, the effects of transactions and other events are recognized when they occur (and not as cash or its equivalent is received or paid) and we are recorded in the accounting records and reported in the financial statements of the periods to which they related.
What is the mean of the concept of "GOING CONCERN"?
The financial statements are normally prepared on the assumption that an entity is a going concern and will continue in operation for the foreseeable future.Hence,it is assumed that the entity has neither the intention nor the need to liquidate or curtail materially the scale of its operation.
Can you give an example for "FAITHFUL REPRESENTATION"?
For an example, a balance sheet should represent faithfully the transactions and other events that result in assets, liabilities and equity of the entity at the reporting date which meet the recognition criteria. http://lahirumanagement.tk/, Carter De Costa & Company
Under this basis, the effects of transactions and other events are recognized when they occur (and not as cash or its equivalent is received or paid) and we are recorded in the accounting records and reported in the financial statements of the periods to which they related.
What is the mean of the concept of "GOING CONCERN"?
The financial statements are normally prepared on the assumption that an entity is a going concern and will continue in operation for the foreseeable future.Hence,it is assumed that the entity has neither the intention nor the need to liquidate or curtail materially the scale of its operation.
Can you give an example for "FAITHFUL REPRESENTATION"?
For an example, a balance sheet should represent faithfully the transactions and other events that result in assets, liabilities and equity of the entity at the reporting date which meet the recognition criteria. http://lahirumanagement.tk/, Carter De Costa & Company
Assignment 10
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Lahiru Yapa
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What is the nature of partnership?
A partnership is a form of business organization which is defined in the U.K.partnership Act of 1890 as "the relation which subsists between persons carrying on a business in common with a view to profit".
Carter De Costa & Co ,http://lahirumanagement.tk/
What are the advantages of partnership form of association?
1. A partnership provide a simple and convenient form of association particularly for those with limited resources and skills who desire to set up a business
2. It also affords an opportunity to a sole proprietor to expand and upgrade his activities by bringing in fresh capital and experienced management.
3. The partnership form is adopted by some professionals who practice jointly, especially since some of them cannot incorporate.
What are the main characteristics of "Working Partner"?
1. A working partner is not considered a partner for tax purposes and is not treated as such. Generally such a person gets fixed share of the profits though he may or may not draw a salary. He is however not involved in losses.
2. The working partner's share of profits is treated as a salary and allowed as a business expense.
3. The working partner's share of profit and his salary paid if any, is the share of profit before adjustment for tax.
A partnership is a form of business organization which is defined in the U.K.partnership Act of 1890 as "the relation which subsists between persons carrying on a business in common with a view to profit".
Carter De Costa & Co ,http://lahirumanagement.tk/
What are the advantages of partnership form of association?
1. A partnership provide a simple and convenient form of association particularly for those with limited resources and skills who desire to set up a business
2. It also affords an opportunity to a sole proprietor to expand and upgrade his activities by bringing in fresh capital and experienced management.
3. The partnership form is adopted by some professionals who practice jointly, especially since some of them cannot incorporate.
What are the main characteristics of "Working Partner"?
1. A working partner is not considered a partner for tax purposes and is not treated as such. Generally such a person gets fixed share of the profits though he may or may not draw a salary. He is however not involved in losses.
2. The working partner's share of profits is treated as a salary and allowed as a business expense.
3. The working partner's share of profit and his salary paid if any, is the share of profit before adjustment for tax.
Assignment 9
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Lahiru Yapa
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• How can we explain the inventories in accordance with SLAS 05
1) In according to the SLAS 05 Inventories are assets;
a) Held for sale in the ordinary course of business;
b) In the process of production for such sale; or
c) In the form of materials or supplies to be consumed in the production process or in the rendering of services.
• What are the inventories that we couldn't apply this standard?
a) Work in progress arising under construction contracts, including directly related service contracts.
b) Financial Instruments (Eg;Treasury Bills & Bonds)
c) Biological assets related to agricultural activity and agricultural produce at the point of harvest.
• What are the costs of inventories?
a) Costs of purchase
b) Costs of conversion
c) Other Costs
• What are the includes in cost of purchases?
a) The cost of purchase of inventories comprise the purchase price, import duties, and other taxes(other than those subsequently recoverable by the entity from the taxing authorities),and transport, handling and other costs directly attributable to the acquisition of finished goods, materials and services. Carter De Costa, http://lahirumanagement.tk/
1) In according to the SLAS 05 Inventories are assets;
a) Held for sale in the ordinary course of business;
b) In the process of production for such sale; or
c) In the form of materials or supplies to be consumed in the production process or in the rendering of services.
• What are the inventories that we couldn't apply this standard?
a) Work in progress arising under construction contracts, including directly related service contracts.
b) Financial Instruments (Eg;Treasury Bills & Bonds)
c) Biological assets related to agricultural activity and agricultural produce at the point of harvest.
• What are the costs of inventories?
a) Costs of purchase
b) Costs of conversion
c) Other Costs
• What are the includes in cost of purchases?
a) The cost of purchase of inventories comprise the purchase price, import duties, and other taxes(other than those subsequently recoverable by the entity from the taxing authorities),and transport, handling and other costs directly attributable to the acquisition of finished goods, materials and services. Carter De Costa, http://lahirumanagement.tk/
Assignment 8
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Lahiru Yapa
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1. Write a Short Description about the sri Lankan money market?
At the time of regaining independences Sri Lanka had a relatively underdeveloped finance market, consisting of a few banks and a limited number of financial institutions. There had been three distinctive types of economic policy regimes after independence.
-1948 to 1959: Liberalized economic regime.
-1960 to 1977: Controlled regime
-1977 onwards: Open Economy
At present the money market has two elements.
• The Organized sector-consisting of banking and other financial institutions
• The unorganized sector-consisting of money lender's pawn brokers, traders and boutique keepers.
The activities of the banks were primarily confined to the plantations and the urban sector. The major activity of the money was the purchase and sale of bills of exchange. The organized money market has widened with the development of commercial banks, expansion of branches to rural and urban areas.
Following are the main components of the money market of Sri Lanka at present.
• The Treasury Bill Market
• The Inter Bank call money market
• The Foreign Exchange (FOREX) market http://lahirumanagement.tk/
At the time of regaining independences Sri Lanka had a relatively underdeveloped finance market, consisting of a few banks and a limited number of financial institutions. There had been three distinctive types of economic policy regimes after independence.
-1948 to 1959: Liberalized economic regime.
-1960 to 1977: Controlled regime
-1977 onwards: Open Economy
At present the money market has two elements.
• The Organized sector-consisting of banking and other financial institutions
• The unorganized sector-consisting of money lender's pawn brokers, traders and boutique keepers.
The activities of the banks were primarily confined to the plantations and the urban sector. The major activity of the money was the purchase and sale of bills of exchange. The organized money market has widened with the development of commercial banks, expansion of branches to rural and urban areas.
Following are the main components of the money market of Sri Lanka at present.
• The Treasury Bill Market
• The Inter Bank call money market
• The Foreign Exchange (FOREX) market http://lahirumanagement.tk/
Assignment 7
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Lahiru Yapa
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What is the liability of a paying banker?
A banker is generally bound to honor his customer's cheques when they are duly presented for payments, provided that they are duly presented for payment, provided that they are duly filled and in proper form. But the bankers do not pay the cheques under the following circumstances.
A. If the banker has notice that the customer has died or been declared bankrupt, or mentally incapable or banker customer relationship is terminated on any other ground.
B. If the customer has stopped payment or countermand the payment o the cheque.
C. If the customer does not have sufficient funds in the account to meet the cheque. But if the bankers so desires, he can honor a cheque even though the account does not have sufficient funds provided the banker has confidence that his customer will settle the dues. That depends on the trustworthiness and relationship in between the customer and the banker.
D. If there is a legal bar such as garnishee orders.
E. If the banker has knowledge that the payment of the cheque would amount to a breach of trust such as the holder of the cheque has no title thereto..
A banker is generally bound to honor his customer's cheques when they are duly presented for payments, provided that they are duly presented for payment, provided that they are duly filled and in proper form. But the bankers do not pay the cheques under the following circumstances.
A. If the banker has notice that the customer has died or been declared bankrupt, or mentally incapable or banker customer relationship is terminated on any other ground.
B. If the customer has stopped payment or countermand the payment o the cheque.
C. If the customer does not have sufficient funds in the account to meet the cheque. But if the bankers so desires, he can honor a cheque even though the account does not have sufficient funds provided the banker has confidence that his customer will settle the dues. That depends on the trustworthiness and relationship in between the customer and the banker.
D. If there is a legal bar such as garnishee orders.
E. If the banker has knowledge that the payment of the cheque would amount to a breach of trust such as the holder of the cheque has no title thereto..
Assignment 6
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Lahiru Yapa
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What are the main components of the Sri Lankan Foreign Market & what are their main transactions?
The Foreign Exchange market in the country has two basic components.
• The Domestic market comprising the central bank of Sri Lanka and authorized foreign exchange dealers.
• The off-shore market
The central bank had been the biggest operator in the foreign exchange market, which involved several types of transactions namely;
1. Investment in gold and foreign currency.
2. Purchase and sale of foreign exchange with commercial banks and with the government.
3. Forward exchange operations.
4. Transactions relating to foreign aid received by the government.
5. multilateral currency clearing operations,
6. Imposition of foreign currency working balances on commercial banks.
A duel exchange rate system was introduced in 1968 to the market with the Foreign Exchange Entitlement certificates (FEECS) scheme. Under this scheme government encouraged non-traditional exports while discouraged non –essential imports. This scheme was abandoned in 1977 with the introduction of the liberalized economic policy.
The Foreign Exchange market in the country has two basic components.
• The Domestic market comprising the central bank of Sri Lanka and authorized foreign exchange dealers.
• The off-shore market
The central bank had been the biggest operator in the foreign exchange market, which involved several types of transactions namely;
1. Investment in gold and foreign currency.
2. Purchase and sale of foreign exchange with commercial banks and with the government.
3. Forward exchange operations.
4. Transactions relating to foreign aid received by the government.
5. multilateral currency clearing operations,
6. Imposition of foreign currency working balances on commercial banks.
A duel exchange rate system was introduced in 1968 to the market with the Foreign Exchange Entitlement certificates (FEECS) scheme. Under this scheme government encouraged non-traditional exports while discouraged non –essential imports. This scheme was abandoned in 1977 with the introduction of the liberalized economic policy.
Assignment 5
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Lahiru Yapa
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Give some examples of conditions or event which increase the risk of fraud or error?
Questions with respect to the integrity or competence of management
• Management is dominated by one person (or a small group) and there is no effective oversight board or committee.
• There is a complex corporate structure where complexity does not seem to be warranted.
• There is a continuing failure to correct major weaknesses in internal control where such corrections are practicable.
• There is a high turnover rate of key accounting and financial personnel.
• There is a significant and prolonged understaffing of the accounting department.
• There are frequent changes of legal counsel or auditors
Unusual pressure within or on an entity
• The industry is declining and failures are increasing.
• There is inadequate working capital due to declining profits or too rapid expansion.
• The quality of earnings is deteriorating, for example, increased risk taking with respect to credit sales, changes in business practice or selection of accounting policy alternatives that improve income.
• The entity needs a rising profit trend to support the market price of its shares due to a contemplated public offering, a takeover or other reason.http://lahirumanagement.tk/,http://www.carterdecosta.com/
Questions with respect to the integrity or competence of management
• Management is dominated by one person (or a small group) and there is no effective oversight board or committee.
• There is a complex corporate structure where complexity does not seem to be warranted.
• There is a continuing failure to correct major weaknesses in internal control where such corrections are practicable.
• There is a high turnover rate of key accounting and financial personnel.
• There is a significant and prolonged understaffing of the accounting department.
• There are frequent changes of legal counsel or auditors
Unusual pressure within or on an entity
• The industry is declining and failures are increasing.
• There is inadequate working capital due to declining profits or too rapid expansion.
• The quality of earnings is deteriorating, for example, increased risk taking with respect to credit sales, changes in business practice or selection of accounting policy alternatives that improve income.
• The entity needs a rising profit trend to support the market price of its shares due to a contemplated public offering, a takeover or other reason.http://lahirumanagement.tk/,http://www.carterdecosta.com/
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- Lahiru Yapa
- මුලික අධයාපණය ෙකාළඹ මහනාම විද්යාලෙයන් ලබා වර්තමාණෙය් වරලත් ගණකාධිකාරි ආයතනෙය් සිසුෙවක් වශෙයන් කටයුතු කරයි තවද කාටර් දි ෙකාස්තා සහා සමාගෙමි විගණන නිලධාරිෙයක් වශයෙන් ද කටයුතු කරයි