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Employee Pension Scheme in Provident Fund

October 7, 2022
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Employee Pension Scheme in Provident Fund Index:- What is EPS? Eligibility to avail EPS Benefits Features of EPS EPS Eligibility Service Calculation…

October 7, 2022
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Registered office for a Company The registered office of a company is the main office of the Company to which all official…

October 7, 2022
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Nowadays, many Bank Customers have been receiving mail for authentication of their bank loans on NeSL (or National e-Governance Services Limited) Different…

October 7, 2022
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What are the implications to file wrong Income Tax Return or Taxes? When the tax season Comes, many people wants to…

October 7, 2022
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The ministry of corporate and affairs under the company law mandate the companies to fill out the E-form INC-22A for the address…

October 7, 2022
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What is Cost audit and When it is required Cost Audit: – It represent the authenticity of cost accounts and cost records which…

07 Oct 22

What is Accounting?

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ACCOUNTING What is Accounting? Accounting is an art of classifying, recording, summarising in a significant manner. It is a systematic process of…

October 7, 2022
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How to Handle Financial Crisis? Index: Why do you enter into Financial Crisis? Is knowledge of Finance Compulsory? Handling of Financial Crisis?…

October 7, 2022
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Earnings per Share (EPS) What is Earnings Per Share? Earnings per share are the net result of the company earned on one…

07 Oct 22

Equalisation Levy

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Equalisation Levy 1.Introduction Equalisation Levy was introduced in India in 2016, via, Chapter VIII OF THE FINANCE ACT 2016. This act is…

Employee Pension Scheme in Provident Fund

Index:-

What is EPS?

Eligibility to avail EPS Benefits

Features of EPS

EPS Eligibility Service Calculation

Contribution towards EPS

How to Check EPS Balance

EPS Withdrawal Rule

What is EPS?

The scheme managed by the Employees Provident Fund Organisation and ensures that employees receive a pension once they attain the age of 58 years old. Existing, as well as new EPF members, can avail of the benefits of the scheme. The employee and employer each contribute 12% of the employee’s basic salary and Dearness Allowance (DA) towards EPF. While the entire share of the employee is contributed towards EPF, 8.33% of the employer’s share goes towards EPS. EPS removes income problems to employees after retirement.

Eligibility to avail EPS Benefits

The eligibility criteria to avail the EPS benefits are mentioned below:
You must be a member of the EPFO.
You must have attained the age of 58 years.
In case you defer the pension for 2 years (until you reach the age of 60 years), you will be eligible to receive the pension at an additional rate of 4% per year.
You must have completed at least 10 years of service.

Features of EPS

The main features of the EPS scheme are mention below

Since EPS is sponsored by the Indian Government, the returns are guaranteed and there are no risks to invest in the scheme. The amount that will be returned will be fixed and no changes will be made.
It is mandatory for employees who earn a basic salary plus DA of Rs.15,000 or less to enrol in the scheme.
You will be able to withdraw the EPS once you attain the age of 50 years. However, the amount that you receive will be at a reduced rate of interest.
In case the widower/widow gets remarried, the children will receive the enhanced pension amount and they will be categorized as orphans.
Employees who are enrolled in the EPF scheme will automatically be enrolled in the EPS scheme.
The minimum monthly pension amount that the individual will receive is Rs. 1, 000.
If the death of a worker then his spouse is eligible for pension amount and in case of spouse death then their children are eligible for pension amount at the age of 25 years.
In case the child is physically challenged, they will receive the pension amount until his/her death.

EPS Eligibility Service Calculation

In case an employee has worked for 6 months or more, the service period will be considered as 1 year. However, if the service period is less than 6 months, the working duration will not be taken into account. Therefore, if an employee has worked for 10 years and 7 months, the number of years of service will be taken as 11. However, if the employee has worked for 10 years and 5 months, the number of years of service will be considered as 10.

Contribution towards EPS

The employer and employee contribute 12% of the employee’s basic salary and DA towards the EPF scheme. The 12% contribution made by the employer is split in the below-mentioned ways:

EPF Contribution: 3.67%

EPS Contribution: 8.33%

Apart from the above-mentioned contributions, the Government of India contributes 1.16% as well. Employees are not eligible to contribute to the scheme.

How to Check EPS Balance

The EPS balance can be checked on the EPFO portal with the help of the Universal Account Number. However, individuals must complete the UAN activation process first. The step-by-step procedure to check the EPF balance after the activation of UAN is complete is mentioned below:

You must visit the official website of EPFO (https://www.epfindia.gov.in/site_en/index.php).
Click on ‘For Employees’ under the ‘Our Services’ menu.
Click on ‘Member Passbook’ on the next page.
Next, enter the User Name (UAN), password, and captcha details. Click on ‘Login’.
On the next page, various Member IDs will be displayed. Click on the respective Member ID.
The total pension amount that has been contributed will be displayed under ‘Pension Contribution’ column.

EPS Withdrawal

If an individual has worked for less than 10 years

An individual will be able to withdraw the EPS amount if he/she hasn’t completed 10 years of service. However, if the employee is currently working and has not finished 10 years of service, he/she will not be able to withdraw EPS amount. Only once the individual quits the company and before joining a new company can the EPS amount be withdrawn.

He/she can withdraw the EPS amount on the EPFO Portal by claiming Form 10C. The employee will need to have an active UAN and the KYC Detail must be linked to the UAN in order to withdraw the EPS amount online.

An individual who has worked for less than 6 months can apply for a scheme certificate but will not be able to withdraw EPS as per the EPFO rules. Depending upon the number of years an individual has worked, only a percentage of the EPS amount can be withdrawn.

If an individual has worked for more than 10 years

EPS withdrawal benefits will be stopped if the employee has completed more than 10 years of service. However, by filing Form 10C, the employee will be able to apply for a scheme certificate.

Registered office for a Company

The registered office of a company is the main office of the Company to which all official communications pertaining to a Company is sent. Every company shall require having a registered office to receive and acknowledging all communications letters and notices as may be addressed to it.

Where a company needs to maintain Book of Accounts:

As per Section 128 of the Companies Act, 2013 every company shall mandatorily require to prepare and keep its books of accounts, other relevant books, and papers for every financial year at its registered office, which give a true and trustworthy view of the state of the affairs of the company, including that of its branch office or offices, if any, and explain the transactions effected both at the registered office, unless and otherwise notice of address at which books of account are to be maintained filed with ROC in form AOC-5 along with Board resolution and other required documents, Pursuant to the first proviso to sub-section (1) of Section 128 of the Companies Act, 2013 and Rule 2A of Companies (Accounts) Rules, 2014

If a company has a branch office anywhere, it shall be deemed to maintain proper books of account relating to all the transactions effected at the branch office are kept at that office and a proper sum up returns periodically are sent to its registered office and the board of directors of the company is responsible to maintain such record.

Inspection of the Books of Accounts

The books of account, other books and papers are open for inspection at the registered office of the company or at such other place in India by any director during business hours.

How much time we need to maintain a record of the Books of Accounts

Every company requires to maintain the books of account for a period of not less than the eight financial years immediately preceding a financial year, or if the company is newly incorporated in that case company require to maintained the books of account since its incorporation date and shall be kept in good order.

Online maintaining books of accounts by the company

Every company can also maintain its all records in an electronic form for the future prospectus, but subject to the following conditions:
All the information and records are in the same format in which they actually generated and should also in true and complete form.
Electronic records should be capable of being displayed in legible form
All the backup of the records shall be kept in a server located in India
All the electronic records and information must be accessible in India

Documents which you need to maintained at the registered office

Register of members
Details of the beneficial owners
Register of directors
Register of secretaries.
Statutory registers
Register of People with Significant Control
Directors’ service contracts.
Register of charges and instruments creating charges (i.e. mortgages, secured loans).
Minutes of board meetings, committee meetings, and shareholders’ meetings.
Copies of decisions and resolutions.
Form filed with various authorities.
Record of directors’ indemnities.
Record of debenture holders.
Record of the sale and transfer/ transmission of company shares.
Company accounting records (Contracts, deed, Record of assets and liabilities, Invoices and receipts, Record of goods and services bought and sold, Record of income and expenditure, Sales books.

Nowadays, many Bank Customers have been receiving mail for authentication of their bank loans on NeSL (or National e-Governance Services Limited)

Different type of loans like Mortgage Loan, Vehicle Loans, Housing Loan, etc. are required to be authenticated on NeSL as per the provisions of the Insolvency & Bankruptcy Code (IBC), 2016 and Insolvency and Bankruptcy Board of India (IBBI) Regulations, 2017.

As per law, the information furnished by one of the parties to the debt needs to be verified and authenticated by all other connected parties. This authentication can be done electronically by affixing digital signature to the information using DSC or Aadhaar e-Sign.

NESL authentication is not for individual, but for HUF, Partnership Firm, Society, Proprietor, Society, Trust, Public Sector Bank, Club.

HOW TO VERIFY AND AUTHENTICATE THE INFORMATION ON NESL.

Go the website: – https://iu.nesl.co.in/NESL_Portal/login.html
Login to the NeSL IU portal using credentials provided to you or register yourself with Aadhar and OTP (In case, user is not already registered)
In case of new user, first register as a one-time process to receive your login credentials.
Provide all the details asked there in for registration
Post successful validation, an SMS or Email (of Login Credentials) will be sent on the registered Mobile Number and Email ID,
After logging to NeSL IU portal with correct credentials, you can view the entire submitted information under menu option Authentication.
In case you find that entire information furnished is correct, then confirm and accept the same by clicking the ‘Authenticate’ button.
In case you find any discrepancy or have any dispute about any of the information, then please select dispute checkbox and you need to clarify the reasons for such disputes by writing reasonable remarks in the space allotted, and click ‘Authenticate’ button.
Then you click ‘Authenticate’ you will be prompted to electronically sign the information by affixing digital signature with your DSC or Aadhaar e-Sign.

FAQs

What is information Utility?

Information Utility is a professional organization, that collects financial information, and get the same authenticated by other parties connected to the debt. It also stores the same information and provide access to the Resolution Professionals, Creditors and other stake holders in the Insolvency Resolution Process. It helps the stake holders in making decisions based on the same information.

The New Law IBC, 2016 creates a new institutional structure, by setting up of Information Utility Companies. It will store all the credit information of Corporates/entities/persons. The Certificate & data furnished by Information Utilities, being the evidence can be accepted by NCLT/DRTs.

As this code aims to resolve the insolvencies in a time bound manner, this information utility set-up is expected to contribute significantly for reduction of NPAs in banking sector.

What is the role of information Utilities?

The information utilities act as a regulated information agency in acceptance, electronically record, get authentication, maintain and provide access to financial information to the persons as may be specified in the IBC Act, 2016 e.g., creditors, Adjudicating Authority and other persons having interest in the information.

What is financial information?

Financial information in relation to a person, means, one or more of the following categories of information, being records of the debt of the person; of the liabilities when the person is solvent; of assets of person over which security interest has been created; of instances of default by the person against any debt; the balance sheet and cash flow statements of the person; and such other information as may be specified.

Who can submit the information to an IU?

Any party connected to a Debt, as Creditor (Either Financial Creditor or Operational Creditor); Debtor (or his authorized representative like Auditor); Co-Applicant, Co-borrower, Guarantor can furnish the information to an IU.

For any clarification and support, Contact Customer Care Number or Toll-free Number 18005992345 or Email at [email protected]

What are the implications to file wrong Income Tax Return or Taxes?

When the tax season Comes, many people wants to complete their Income tax returns. Firstly, because they look forward to a possible refund. Secondly, because it is good practice to reduce your risk of identity theft by the taxpayer. But if you’re in a hurry to fill out and file those forms, what happens if you file your taxes incorrectly?

You may have a brief moment of fear when you realize that you sent the Internal Revenue Service (IRS) wrong or incomplete information, but don’t worry. Everyone makes mistakes, including the IRS. Therefore, the federal tax office has processes and forms in case this happens.

If you’ve filed your taxes incorrectly, you’re not alone. We’ve found everything you need to know about what happens when you file your taxes incorrectly, from possible reasons you can take precautions to avoid this next time.

What are the implications if you make a Mistake on Your Tax Return?

Depending on the type of mistake, who finds it and how you handle the situation, a few things can happen when you file taxes incorrectly. Here are some things you might deal with

You Realize the Mistake Shortly After Filing

If you send off your tax return and notice that you’ve made a mistake, you can’t just refile another tax return and assume the IRS will know that it’s the right one. You need to follow the steps for fixing incorrectly filed taxes. That typically involves filing an amended return or sending a specific form in.

The IRS Finds Your Mistake When Processing Your Return

If the IRS finds something missing or thinks you made a mistake in your return, it will send you a notice. Typically, these notices let you know exactly which form you need to file to fix your mistake. They also give you a timeline, such as 20 to 30 days from the date you received the letter, to comply.

Getting any type of letter from the IRS can be scary, but don’t panic. The IRS sends hundreds of thousands of these letters out, and it just wants to see a response as soon as possible.

The Mistake Isn’t Found Immediately

If neither you nor the IRS finds the mistake, the tax return might be processed with the error in it. That could increase or reduce your refund incorrectly, depending on what type of mistake was made.

The mistake might be uncovered in the future during an IRS review or audit of records. You or your accountant (or CPA) might also find the error when conducting audits of your own files. In this case, you may owe interest on any amount that you should have paid but didn’t. You might also need to repay part of a refund that was incorrectly issued to you.

Since interest accrues from the original date the taxes were due, this can add up a bit. However, IRS interest charges are much less than charges due to failure to file or pay penalties. You should still file your taxes on time each year. It’s in your best interest to file accurately or correct any mistakes as soon as possible to avoid interest.

Steps for Resolving Taxes That Were Filed Wrong

How you resolve an incorrect filing depends on the mistake. If you receive a notice from the IRS about a potential mistake, follow the instructions in that document as soon as possible to resolve the issue. If you find an issue yourself, use the steps below to resolve it.

Make sure that it’s really a mistake or issue. Double-check your filing, or if you’re not sure whether there’s a problem, consider getting professional help from a tax filing service or CPA.

Determine whether the IRS already caught the issue. If your return has already been processed and you received a refund, double-check the amount. Did you receive more or less than you thought you would? If so, the IRS might have corrected your return for you based on W2 form and 1099 form information it receives about your income. You will likely receive a communication letting you know a change was made and why.

If you do need to provide updated or additional information to the IRS, you’ll need to file a amend return through 1040-X Form. Even if you simply need to append another form to your tax return, you still have to file the amended return. This lets the IRS know that you’re sending new information and it should reprocess your return in light of that.

Plan to pay any new taxes you might owe as a result of the change as quickly as possible to avoid accruing interest.

Common Tax Mistakes People Make

Tax returns require a lot of numbers, math and reading. Getting all those details into the right columns takes work, even for pros. So, if you’re handling your tax return yourself, you could easily make a mistake. But it’s not something to feel bad about. Here are a few common tax return mistakes the IRS regularly sees.

Arithmetic Mistake – It’s easy to miscarry a number or even miss one completely when you’re adding up rows and columns to get the answer for the next line on your tax return. If the IRS catches an arithmetic error, it’ll usually fix it and notify you of the result.
Forgot 80 C to 8o U Deductions– This one can cause you to owe more taxes than you should. Unfortunately, the IRS isn’t under an obligation to find all your deductions for you, and it probably won’t let you know even if it does see the possible error. This is why it’s a good idea to use professional tax preparation software or work with a tax service so you get the largest refund you can.
Non Disclosure of Total Income – Whether you forgot about a W2 or got a 1099 in the mail after filing your taxes, this is one you should fix as soon as possible. Even if the income won’t change how much taxes you owe, it needs to be accounted for on your tax return.
Cheat on taxes – You can’t mislead the numbers to get more deductions or hide income. That’s illegal, and this is the one time a tax mistake can come with consequences that go beyond a little hassle and a bit more expense. If you’re found lying on your taxes to evade paying them, you could be charged criminally.

Tips for Minimizing Mistakes Come Tax Season

Sure, filing your taxes wrong can be an honest mistake. And you definitely don’t need to freak out about it. But that doesn’t mean you should take a laid-back approach to taxes either. Follow these tips for minimizing the chances that you’ll make careless errors during tax season.

Keep up with your finances throughout the year. Keeping receipts, payments and income forms organized all year reduces how much work you have to do during tax season. It also cuts down on the chance that you’ll lose or leave out important information.

Use a professional service or software. Pay for an experienced pro to file your taxes to help ensure you cover all possible data and get the most in deductions. Many of these services will also file a free amended return if any mistakes were their fault.

Wait to file until you have all the information. An early refund is great, but avoids filing before you have all your information. The Government gives extension to file Income Tax return so Note that filing an extension does not extend your obligation to pay whatever taxes you might owe in due date.

Keeping up with your taxes can help you avoid a situation that could derail your entire financial life. But you don’t have rushing into filing to keep your identity and credit history safe. Instead, keep an eye on your credit report via our free credit report card all year to understand what’s going on with your score and identify potential fraud early on. Then, you’re free to file your taxes at a time that’s most appropriate for you and helps cut down on possible mistakes.

The ministry of corporate and affairs under the company law mandate the companies to fill out the E-form INC-22A for the address recognition while the form(INC-22A ACTIVE form)This new form is applicable to all registered companies, whether register companies Act 2013 or Act 1956.

Why this form is given:

Another step has been taken by the government to identify and eliminate shell companies. The government has taken a number of measures to track shell companies, i.e. round-tripping or money laundering to obscure only a paper-working company and either the vehicle or the ownership. Firstly, during the year 2018, the government hit around 2 lakh companies, which failed to file their financial statements or annual returns for two or more years, and secondly, for failing to file annual returns. And there are companies with more than one million directors were disqualified. To avoid ghosts or dummy directors, MCA Introduced DIR-3E-KYC shall file by every DIN holder with such details ie personal mobile number, OTP verification with email ID and details with ID and address proof.

Now MCA has issued a new notification to file e-Form INC-22A (Active Company Tagging Identification and Verification-ACTIVE ). The last due date for submission of this return was 25 April 2019. This due date has been extended to 15 June 2019 as per MCA notification on 25 April 2019.
As per MCA notification, a late filing fee of Rs 10,000 / – from 25 June 2019 to 25 April 2019 (revised from the last applicable date of 26 April 2019).

Every company was incorporated on or before 31 December 2017.

In the following situation exemption is available:

Under a process of strike-off or Strike-off companies
Dissolved companies
Companies under amalgamation
Companies under liquidation

Main prerequisites for filing this form:

Financial MCA till the latest financial year 2017-18. Financial statements and annual returns have been filed.
All directors of the company have filed their DIR-3E-KYC i.e. and the position of directors should be activated.
In public listed companies or companies with a share capital of more than Rs 5 cr. it is mandatory to conduct a cost audit to ensure that they have appointed a full-time company secretary and to do so.
All the chief managerial personnel is appointed and placed in their office as per the Companies Act 2013.
To ensure that all Minimum Directors are holding positions as per Companies Act 2013.

What information is required to be given in the form:

About the Company Details:

Name & Reg. Office
Latitude & Longitude (RO)
Mail ID & OTP verification
DIN
Photograph of Registered Office with Board of company

Statutory & Cost Auditor Details:

Name, PAN
Membership, Firm Registration Number (FRN)
Period of appointment

Key Managerial Personnel (KMP) information.

Details of CS
Details of annual returns – SRN of e-form AOC-4 & MGT-7 for the recent financial year 2017-18
Compulsory attachment of photo – Attachments should be in PDF only

Please Note

If any company is failed to complete the Active form compliance that company shall not able to Changes in Authorized Capital, Paid-up capital, Appointment of Director, (except Resignation), Address change and filing the annual returns.

What is Cost audit and When it is required

Cost Audit: – It represent the authenticity of cost accounts and cost records which is maintain by the companies who are required to get the cost audit done. Cost audit ascertain the accuracy of cost accounting records and ensures that they are in conformity with cost accountings principles, Cost accounting standards, plans, procedure and objectives.

Cost Records:-Meaning of Cost records define in rule 2 (e) of companies (cost record & audit) rules 2014, cost records are those document which represent the utilisation of material ,labour and other items of cost applicable to the production of Goods or provision of services as provided in sec 148 of companies (Cost record and audit) rules.

When preparation of cost records is necessary:-

According to rule 3 of the companies rules 2014 (Cost records and audits) rule contains two table namely Table A i.e. Regulated sectors & Table B i.e. Non Regulated sectors.

Cost records are required to maintain when companies engaged in the production of goods and provision of services & they are covered under the Table A or Table B and total turnover from all of its production or services in more than INR 35 Crores during the preceding financial year.

In simple words we can say that if products or service covered under table A or table B and its total value crosses INR 35 Crore then cost records are compulsorily maintain by company and it’s become the mandatory part of books of accounts.

Applicability of cost Audit:-

Provision of cost audit are applicable if these conditions are fulfilled:-

Condition Regarding TABLE A:-

1. Overall annual turnover of the company from all the products and service is Rs. 50 Crore or more; and

2. Aggregate turnover from the products and service for which cost records are required to maintain is Rs. 25 Crore or More

Condition Regarding Table B:-

1. Over all annual turnover of the company from all products and services is Rs. 100 Crore or more and;

2. Aggregate turnover from the individual products or service for which cost records are require to be maintain is Rs.35 Crore or more.

It must be noted the for checking the threshold limit year should be preceding financial year

Cost audit will not applicable if following conditions fulfilled:-

Revenue from exports is more than 75% of total revenue and revenue must be in foreign exchange.
If Company operating from special economic zones.
Company engage in generation of electricity for captive consumption through captive generating plants.

Time limit for appointment of Cost auditor:-

Cost audit as mentioned in sec 148(2) of companies act, will only conduct by practicing cost and management accountants (CMA), who is appointed by the board of director of company within 180 days of the commencement of every financial year.

Meaning of Cost and Management accountants (CMA):-

As per the rule 2(b) & 2(c) of the rules mentioned in the cost and work accountants act 1959, Cost accountant in practice define. Cost Accountant in practice means a cost accountant u/s 2(1) (b) of the cost and work accountant act 1959 who hold valid certificate of practice and it include firm and LLP also.

Who can perform cost audit:-

Cost audit exclusively perform by cost auditor who is cost & Management accountants in practice (CMA).

Author: – CMA Praveen Kumar Tiwari

Websites: – https://www.mycorporation.in/

ACCOUNTING

What is Accounting?

Accounting is an art of classifying, recording, summarising in a significant manner. It is a systematic process of identifying, recording, measuring, classifying, verifying, summarizing, interpreting and communicating financial information. It reveals profit or loss for a given period, and the value and nature of a firm’s assets, liabilities and owners’ equity.

Accounting provides information on the resources available to a firm, the means employed to finance those resources, and the results achieved through their use.

Why you need Accounting?

Accounting is essential if you want to be able to grow your business in a way that can be measured and predicted. Having a system of tracking your business assets, liabilities and income lets you make smart, informed business decisions based on the past performance and present financial health of your company. With a clear, organized accounting system you can not only analyze your company’s financial data but also help it grow and profit.

Sound accounting also helps you satisfy your customers. Knowing where your company stands financially in terms of income and expenses will help you better understand what you need to do in the future to maintain that level of customer satisfaction and your business.

Advantages

It helps in the preparation of financial statements.
Accounting information is also used to compare the result of the current year with the previous year to analyze the changes.
It helps the managers in the decision making process.
It provides information to other interested parties such as shareholders, creditors, investors, customers, government, employees.
It helps in taxation matter
Accounting information can be produced as evidence in the legal matter.
It helps in the valuation of the business.

Disadvantages

The items expressed in monetary terms are recorded in the accounting whereas the items which are non monetary nature not recorded.
Sometimes accounting data are recorded on the basis of estimates and which could be inaccurate.
Fixed accounting are recorded as the original cost.
Value of money does not remain stable so accounting value does not show true financial results.
Accounting can be manipulated and biased.

Process
Analysis of the transaction.
Prepare the transaction in source documents such as purchase order or invoice.
Qualify the transaction in monetary terms.
Record the transaction by making entries in the appropriate journal.
Post journal entry to ledger accounts.
Prepare trial balance to make sure that debit equal to the credit account

How to Handle Financial Crisis?

Index:

Why do you enter into Financial Crisis?

Is knowledge of Finance Compulsory?

Handling of Financial Crisis?

Some General Tips

Why do you enter into Financial Crisis?

Finance ……. a term that is linked to numbers, but are they only numbers from 0 to 9?

Take a moment and think about it.

Yes, it is related to numbers, of course, but the range is much wider than just overlooking numbers.

It is more about planning, a deeper understanding of your needs and goals rather than believing in these schedules to double your money overnight.

Believe me, no one and no one can become a millionaire overnight.

It takes a lot of hard work in the right direction, determination, sleepless nights, postponement of death and adopting an ideal and healthy lifestyle.

Getting into these false pitfalls set up for us in a very attractive way, we end up doing things or buying things that don’t really make sense.

In other words, as our oldest says, spread your legs according to your sheets.

Some examples of this include buying fancy shoes, dresses, and other accessories that you think will be needed in your everyday lifestyle are dumped into your wardrobe and result in your waste of money.

Another example is excessive use of credit cards, especially by young people.

(Reply if you need an article explaining it)

With this we can conclude that Finance is a deeper understanding of numbers to make the right decision at the right time, which helps to grow our resources.

So first create different sources of income and build a nice portfolio of asset management and then spend it on your luxury items.

Is knowledge of Finance Compulsory?

This doesn’t mean you can’t become a millionaire at all if you haven’t done a specialization in Finance. In our society there is a clan called “Baniyas”, we consider them the most knowledgeable person in dealing with their finances.

Did they study finance?

Have they graduated from the top Business School?

Are their spirits specially designed from birth?

Answers to the above questions will certainly be ‘No’, what is the reason behind it?

The reason behind their knowledge of Finance is their careful observation of how things work in the market, that is, observing the supply and demand of money in the market and making predictions based on it, which often turn out to be correct because they are not made on the basis of gambling or intuition, it is made on the basis of realistic grounds.

Handling of Financial Crisis?

The above points should be addressed in the future, but if you end up in such a debt trap now, here is the way out.

Of course, the method of dealing with a crisis depends on examining the situation. So here’s the general way out to just give you the sketch that can help you in your situation.

Make a journal of all of your available assets (i.e. liquid assets or in the worst case, you can afford to sell out).

On the other hand, in the same way, list all of your debts to be paid off and your current obligations (such as monthly home expenses, child expenses, or your parents’ medical expenses).

First, settle the short-term liabilities with the most liquid assets and keep a reserve for the next six months as pregnancy time to recover from this crisis.

Then try to cover as much debt as possible with the remaining assets.

Finally, when all your available assets have been cleared and your obligations still exist, try to find with the calm mind (since stressful decisions cannot be treated with stress) the means by which you can afford the same.

Make sure that the resources you choose must be authentic and reliable. Stop taxing yourself by taking out a loan from informal sources.

I know formal sources have their procedures, documentation and regulations, but this rush is worth being threatened by informal sources.

Some General Tips

Here are some general tips, finally, to reduce your monthly expenses and your emotional burden that has nagged you for so long.

Communicate it with your family. (This will certainly act as a double sword)

First, they will act as your path leaders and moral supporters

Second, they will contribute to your struggle to keep everything intact.

Please don’t trust anyone else as they may be looking for the moment just to take advantage of yours. There is also a saying in this regard, “Don’t judge a book by its cover.”

Try cutting out all the beautiful things in your lifestyle, such as a meal at a gourmet restaurant and family trips to vacation destinations.

PS: I hope you like my little initiative to calm your stress level. Reply and let me know your reviews if they are negative too, I would appreciate them.

Earnings per Share (EPS)

What is Earnings Per Share?

Earnings per share are the net result of the company earned on one share. It is an important and widely used measure that audited the financial reports of the companies and also mentions in particular in most countries. In other words, it expresses the earning power of the company, if divided by the value of one share. We usually call it return on equity. The higher the EPS, the better the company’s performance and outlook. EPS ‘multi-year track record reflects the company’s growth rate and potential investors look forward to investing in the company if they see an upward trend.

Formula For Calculating Earnings Per Share

The Formula used for earnings per share ration is as follows

Earnings per Share = Profits/Earnings after taxes (EAT) – Preference Shares Dividend/Number of Equity shares Outstanding

The steps for calculating post-tax earnings / gains less deduction of preferred stock dividend (also known as earnings available to shareholders whether or not distributed as dividends) are as follows:

Net Profit: Take the net profit / loss for the year from the company’s income statement. Audited financial data is preferred because it ensures proper compliance with all accounting standards and generally accepted accounting principles. Net profit here means that the profit has arrived after deduction of taxes. The tax rate would differ for different countries according to the respective laws.

Deduct Preference Shares Dividend: Regarding preference shares, the dividend for cumulative preference shares is deducted even if not distributed, but for non-cumulative preference shares, the dividend is deducted only when distributed.

A number of outstanding shares

The number from existing shareholders. If the number of shares changes in the financial period, a weighted average of shares is calculated. Weights are given according to the number of days or months outstanding during the year.

DILUTED PROFIT PER SHARE

The diluted EPS is the EPS, assuming that all convertible securities have already been converted into shares. Convertible securities such as employee stock option, convertible preferred share, convertible bonds, etc. It is the EPS after giving the effect of such securities on both the numerator and the denominator of the EPS. The numerator is increased by the amount of dividend or interest that is not paid in the event of conversion of such securities. The denominator increases with the no. of shares issued as a result of such conversion.

So the formula becomes

Diluted Earnings Per Share = (EAT- Preference Dividend+ Expenses because of conversion of Equity Shares) / (Weighted Avg. No. of Equity Shares+ Weighted Avg. Converted Equity Shares)

ADJUSTED EARNINGS PER SHARE

Adjusted earnings per share are the ratio of net income from regular activities available to shareholders of shares. It does not affect the following:

Extra ordinary items: items that appear suddenly without prior notice, such as windmill profit or loss from natural disasters, etc.

Irregular Activities: Activities that are not part of the day-to-day business of the company, such as asset sales, loss through fire, etc.

Adjusted EPS mainly serves for comparisons between Intra Company and Intercompany.

NEGATIVE EARNINGS PER SHARE

Sometimes companies incur losses, i.e. negative profits, which make the EPS negative. Negative EPS shows how much money the company has lost per share. Shareholders do not have to pay the loss share directly to the company, but suffer indirectly. The net loss decreases the value of the company, which in turn decreases the value of the shares. Negative EPS is not always a reason to panic. Sometimes it is also a good sign. For example, when a company develops new products, or when it incurs large one-off costs, the negative EPS for a certain period is a temporary phenomenon.

INTERPRETATION / ANALYSIS OF EARNINGS PER SHARE

Earnings per share are most frequently present in financial statements and are a very reliable figure for investors. It is useful for existing and new equity shareholders for forecasting the value of the shares in the future. A high EPS is a sign of better earnings, strong financial position and therefore a reliable company to invest in. The EPS for several years indicates the growth pattern of the company. It also helps in comparison to figures of different companies in the same industry.

Equalisation Levy

1.Introduction
Equalisation Levy was introduced in India in 2016, via, Chapter VIII OF THE FINANCE ACT 2016. This act is applicable to the whole India except J&K. The main reason for introducing this section to impose a tax on google who generate revenue of Rs. 4108 in 2014-15 and Facebook also generate Rs. 123.5 crores during the same period which was not taxed earlier. Due to this govt. will collect a higher amount of Tax.

2.Applicability of Equalisation Levy
Equalisation Levy will be charged only when the below two conditions will be satisfied.
a. The payment should be made to non-resident service providers and
b. The annual payment made to one service provider exceed Rs.1,00,000 in one financial year

3.Charge of Equalisation Levy
As per section 165 of Income-tax act equalisation Levy will be charged @6% of the amount of consideration for any service received by the service receiver from the service provider subject to-
such a person is a non-resident Indian.
Example:

Ramparsad Yadav has advertised on Facebook to expand his business. He has to pay Rs. 2,00,000 in FY 2017-18 to Facebook for the advertising services availed.

Solution:

Facebook will bill Ramparsad Yadav for an amount of Rs. 2,00,000/-

Ramparsad Yadav will deduct TDS at the rate of 6% of Rs. 2,12,765.9 = Rs. 12,765.9 and pay the balance of Rs. 2,00,000 ( Rs. 2,12,765.9 – Rs. 12,765.9) to Facebook and deposit the tax amount before 7^th of the next month by using challan 285.

4.Collection and payment of Equalisation Levy
As per section 166 of Income-tax act equalisation levy deducted during any calendar month is to be paid by the seventh (7th) of the month immediately following the calendar month by using the challan no. 285.

5.Furnishing of annual return/statement of specified services
As per section 167 of Income-tax act statement of specified service is required to be furnished electronically in FORM NO.1 (verified through either a digital signature or an electronic verification code by an authorized signatory) on or before 30 June immediately following that financial year. The Tax Officer has been empowered to issue a notice for furnishing such a statement, which then has to be furnished within 30 days from the date of serving of such notice, where the same is not filed within the prescribed timeline

6.Interest on delay payment of equalisation levy
As per section 170 every assesses who fails to deposit the tax shall be liable to pay interest @ 1% per month or part of the month.

7.Penalty for not- filing of Levy return
Every assessee who fails to furnish the statement within the time prescribed u/s 167, he shall be liable to pay a penalty of 100 per day during which the failure continues.
Disallowance of expense
In case the tax does not deposit then the amount of expenditure shall be disallowed in the hand of the payer(unless the defect is rectified).

Prosecution
If the false statement has been filed the person may be subject to imprisonment for a period of 3 years and a fine.

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