Forex Currency fluctuation
This query is : Resolved
25 June 2010
Suppose in X Ltd. an employee was given 100USD on 1st march 2010 by the company not directly but through a forex vendor, who billed the company in INR, The employee then comes back to India on 30th April and returns 20 USD to the dealer. The dealer then refunds the money in INR to the company on the rate as on the actual receipt.The co. records the difference of rates for da returned currency as forex gain/loss. My question is whether we should book unrealised profit/ loss as on Mar 31,2010 in the company's books, and whether it qualifies as a monetary asset as per AS 11????
25 June 2010
Hi
Treatment is depend on the nature of transaction, accounting etc., In this specific case, you have to account as 'employee advance', which will be accounted under 'advances' and Exchange flctuation has to be calculated.
Receivables will be treated as Monetary Items and hence even advance may be classified as Monetary on the above lines.
Treatment is depend on the nature of transaction, accounting etc., In this specific case, you have to account as 'employee advance', which will be accounted under 'advances' and Exchange flctuation has to be calculated.
Receivables will be treated as Monetary Items and hence even advance may be classified as Monetary on the above lines.
25 June 2010
so dis means we book da unrealised profit/ loss on 100usd??
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