Accounts_profit and Previous losses

[ishfaqsangra]

My third year Profit is 16000 and my accountant said there is no corporation tax as prevoius years losses which is 26000 should be accounted first and still company is in loss of 10000 .

He said its legal accountingl practice?

Any commets.

[MYA]

He is correct,

There is no such requirement in policy guidance that company has to be in profit. But company has some trading activities like revenue generating(not profit).

You ok in both cases but if they call you for interview and they ask about profit then explain them there not now.

[zimba]

A company is in profit only and only if your accumulated losses are smaller than your generated profit. Basic business concepts

[ishfaqsangra]

Thanks all.
Basic concept regarding profit was clear sir ...the accumulated net profit/loss only cleared when accounts are done.
Thanks for inputs again.