provision for annual and lng service leave

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 · Accepted Answer

YellowPotato · Answer

For accounting purposes, you can do these provision accounts. I think you are talking about the expense for providing the provision on the profit and loss statement, you 'undo' the expense in the 'reconciliation' section of the income tax return as it's not a deductible expense for tax purposes. When you do pay it, remember to add the expense in the 'reconciliation'. Journal entries for accounting purpose for adding leave entitlements would be Dr Leave entitlements (expense) Cr Provision for leave entitements (liability) Then when you pay it out. Dr Provision for leave entitlements (liability) Cr Cash at bank (asset)

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