Doing your homework for disclosure of assets

Arnav PandyaThere is now a requirement for several taxpayers to provide details of their assets and liabilities in case they have income that crosses a certain limit. This has posed a big problem for many of them because getting all the details together can be a tough task that might not be easy to complete. This is the reason why there has to be special attention paid to this aspect so that there is nothing that remains left out and that everything is covered. For a lot of people there is also a big question as to how they should start to gather the various details and its completion. Here is a detailed look at the heads that need to be included and how this should actually be done.Fixed AssetsWhen it comes to various assets there is a simple way in which the individual can try and ensure that they have covered all the areas. One is to break up the assets into two main parts. Fixed assets would make up one part and financial assets or investments would make up the other part. Fixed assets are those assets which have a physical presence and hence can be felt. These can be of various types and would include those like land and buildings or property where there are rights to these or it can also mean things like cars and two wheelers. Gold and jewellery will be an important component for many people. Each individual would have a different mix of them and it is important for a person to know the cost of these assets because the amount paid for them would have to be shown in the figures that would make up the balance sheet.InvestmentsThe key part of the entire creation of the assets side is likely to be investments because this is a very wide space and there are a lot of items that are present here. Some of them could get missed out and this happens if you are not preparing the details regularly so this requires some time and effort. One can break up the details into various sub categories like stocks, bonds, fixed deposits, mutual funds etc. Even after doing this the task is not going to be easy because each specific holding would need to be present and then this would have to be added up. The difficulty that arises in the process is that when the investments are listed out often there is no cost price available for them due to the fact that they were bought quite some time back and there are no ready records available. In case of stocks the problem is compounded because there might have been several corporate actions in between like splits, bonus, rights which makes the job tougher. In case of mutual funds there might have been a lot of investments which could make arriving at the cost difficult.Short term assetsMost people have short term assets which could include some loans given to different people or it can be some advances that have been paid. The most common type of asset in this category is cash balance that is present with the person. The difficulty here that will be encountered is that the cash balance has to be as on 31 march of the previous financial year which would now be impossible to estimate. At the same time the bank balances also need to be known but these can be obtained from the bank account statement.LoansOn the liabilities for a person a big figure is likely to be loans that have been taken from other persons and entities. This will include all types of loans like housing loan, car loan, personal loan etc and these need to be shown with the outstanding balance at the end of March. Normally even when a person has a loan they might not know how much balance is outstanding but this is what needs to be found out.