Accounting · Accounting Corrections and Adjustments

A legacy cooperative bank is transitioning its accounting from a manual system to a 'Cloud-Based ERP' in March 2025. The transition team discovers that over the last 5 years, the bank has been recording the purchase of all computers and servers as 'Office Expenses' to save on taxes, totaling 85,00,000 rupees. They also find that the 'Building Account' includes the cost of land (40,00,000 rupees) and the building (60,00,000 rupees), but the bank has been depreciating the total 1,00,00,000 rupees at 5% annually. Furthermore, several 'Interest Suspense' accounts have been used to park uncollected interest on bad loans to show higher profits. The total amount in these suspense accounts is 1,20,00,000 rupees. The new ERP requires every transaction to follow strict Accounting Standards. The bank must now capitalize the equipment, separate land from building (since land does not depreciate), and reverse the interest in suspense. What will be the impact on the bank's Net Profit for the current year and the Fixed Assets balance in the balance sheet after these corrections?