Measurement of Revenue
Revenue should be measured at the fair value of the consideration received or receivable. An exchange for goods or services of a similar nature and value is not regarded as a transaction that generates revenue. However, exchanges for dissimilar items are regarded as generating revenue. (more…)
Classification of Leases
A lease is classified as a finance lease if it transfers substantially all the risks and rewards incident to ownership. All other leases are classified as operating leases. Classification is made at the inception of the lease. (more…)
What is Estate Duty?
Estate Duty is payable on the estate of every person who dies and whose nett estate is in excess of R3.5 million. It is charged at the rate of 20%. Estate duty is levied on the property of residents and South African property of nonresidents less allowable deductions. The duty is levied on the dutiable value of an estate at a rate of 20% on the first R30 million and at a rate of 25% above R30 million. A basic deduction of R3.5 million is allowed in the determination of an estate’s liability for estate duty as well as deductions for liabilities, bequests to public benefit organisations and property accruing to surviving spouses. (more…)
Personal Service Company or Trust
This is a company (or trust as the case may be) that is not a labour broker, and whose services to clients are performed on its behalf by a connected person;
- and such a person would be regarded as an employee of the client if the relationship was directly between the person and the client; or
- the person fails the control and supervision test; or
- the person fails the regular payments test; or
- more than 80% of the income of the company/trust from services rendered is directly or indirectly from the client;
Liquidation is the process of bringing a business to an end and distributing its assets to claimants. It is an event that usually occurs when a company is insolvent, meaning it cannot pay its obligations when they come due. As company operations end, the remaining assets are used to pay creditors and shareholders, based on the priority of their claims,
Liquidation and deregistration are not the same things. (more…)
Capital Expenditure (CAPEX) Capital expenditure, or CapEx, are funds used by a company to acquire or upgrade physical assets such as property, industrial buildings or equipment. It is often used to undertake new projects or investments by the firm.
This type of outlay is also made by companies to maintain or increase the scope of their operations. These expenditures can include everything from repairing a roof to building, to purchasing a piece of equipment or building a brand-new factory. (more…)
A foreign currency transaction should be recorded initially at the rate of exchange at the date of the transaction (use of averages is permitted if they are a reasonable approximation of actual).
At each subsequent balance sheet date, foreign currency monetary amounts should be reported using the closing rate non-monetary items, carried at historical cost should be reported using the exchange rate at the date of the transaction. Non-monetary items carried at fair value should be reported at the rate that existed when the fair values were determined. (more…)
Forecasting in business is the practice of predicting a company’s financial results at certain points in the future, based on certain assumptions and estimates as well as past performance. At we PATC, we understand that whether the forecasting method is simple or sophisticated, the objective is to enable the company to take certain actions in the present that will position it well in the future. Companies should make it a regular practice to compare actual results to projections. This will give subsequent forecasting the benefit of experience. (more…)
Financing is the act of providing funds for business activities, making purchases or investing. Financial institutions and banks are in the business of financing as they provide capital to businesses, consumers and investors to help them achieve their goals. PATC is here to help you understand business financing, keep reading the blog as we explore your options. (more…)
What are the possible allowances and fringe benefits?
Below are the lists of available allowances and fringe benefits.
Also Read Now: Valuation of Shares, Goodwill & Members Interest