Murali (CA final cleared and CS final) (102 Points)
05 August 2008Company X has given an advance of USD 1000 for an import puchase (ex rate - Rs.40/USD) on 01.04.08. Later it received an invoice for USD 1000 on 01.05.08(ex rate - Rs.45/USD. For what INR the purchase should be accounted? Is there any foreign exchange gain/loss.
S.Srinivasaraghavan
(Chief Financial Officer and Co)
(11318 Points)
Replied 05 August 2008
The exchange rate on the date of bill of lading (For purchase on FOB contract) should be used for accounting for purchase. Thereafter if there is a variation it should be expensed to P&L account as exchange loss.
Raakhi
(auditing)
(26 Points)
Replied 29 August 2008
"As per AS 11-transactions should b converted at closing exchnge rate at the period end , however if the rate is unrealistic then the transaction may be converted at the rate which is realizable."
here when can the rate be unrealistic.
Analysis of 20 GST Notices (including 2 Appeals) and Practise on Drafting(with recording)
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