Forward contract

This query is : Resolved

CA Manish K Dhoot (Querist)
Follow

25 June 2012 What is the accounting treatment of forward contracts entered for the purpose of Firm commitments and highly probable forecast transactions.
AS 30 is not applicable in this case and AS 11 does not prescribe the treatment of Firm commitments and highly probable forecast transactions.
so what accounting treatment will be done for this type of transactions ?

Sanjay Chauhan (IFRS)

Sanjay Chauhan (IFRS) (Expert)
Follow

25 June 2012 Derivative Contracts not covered under AS 11 are to be accounted in line with the Notification issued by ICAI.

BY virtue of whihc the all loss MTMs are to be accounted and gain MTMs are to excluded.

A complete disclosure of Nominal Value, MTM and Type of Contract needs to be given in notes to accounts.