AS-11
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
09 February 2010
Dear memebers i have one query regarding as-11
SUPPOSE A COMPANY HAVING EEFC ACCOUNT...
IT HAVE ENTERED INTO A TRANSACTION WITH FOREIGN COMPANY AND THERE IS LIABILITY OF 100$ AT RATE OF 1$=RS.45 ON DATE 09/02/2010..
ON THE SAME DAY IT HAS CLEARED THE DEBT ON THE SAME DAY..THEN AT WHAT RATE the transaction is to be identified..is there any effect for eefc account
SUPPOSE A COMPANY HAVING EEFC ACCOUNT...
IT HAVE ENTERED INTO A TRANSACTION WITH FOREIGN COMPANY AND THERE IS LIABILITY OF 100$ AT RATE OF 1$=RS.45 ON DATE 09/02/2010..
ON THE SAME DAY IT HAS CLEARED THE DEBT ON THE SAME DAY..THEN AT WHAT RATE the transaction is to be identified..is there any effect for eefc account
10 February 2010
In a similer situation my client is accounting as under:
On receipt of payment in foreign currency from customer they depositing in EEFC account and accounting in rupee at the rate of sales invoice. Whenever transfering from EEFC account to current account difference between the depositing rate and transferred rate charged to gain/loss on exchange rate. However while discharging liability in foreign currency from EEFC account the rate is being used, the rate at which the accounting entry passed at the time of depositing hence in such case no exchange gain or loss appeared.
In your case
1) You can discharge the liability at the rate at which the balance is appeared in the EEFC account then there will not be any exchange rate flactuation.
2) However if you want to pass entry @45 per USD then if Your EEFC account has rate more then Rs.45 per USD then therewill be loss on account of exchange rate flactuation and vice-versa.
On receipt of payment in foreign currency from customer they depositing in EEFC account and accounting in rupee at the rate of sales invoice. Whenever transfering from EEFC account to current account difference between the depositing rate and transferred rate charged to gain/loss on exchange rate. However while discharging liability in foreign currency from EEFC account the rate is being used, the rate at which the accounting entry passed at the time of depositing hence in such case no exchange gain or loss appeared.
In your case
1) You can discharge the liability at the rate at which the balance is appeared in the EEFC account then there will not be any exchange rate flactuation.
2) However if you want to pass entry @45 per USD then if Your EEFC account has rate more then Rs.45 per USD then therewill be loss on account of exchange rate flactuation and vice-versa.
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Querist : Anonymous
Querist :
Anonymous
(Querist)
10 February 2010
thanq very much...
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