CA Sk Hasan Ali (Chartered Accountant) (37 Points)
06 May 2009Dear friends please clarify this doubt...
An exchage house gets converted its local currency to USD by way of transferring amount from its local currency account to USD a/c maintained in same bank. In this process its local bank gives some discount in conversion rate by way of passing a single credit entry monthly. My doubt is whether such discount is exchange difference?
V P Narasimhan
(Accounts Manager)
(791 Points)
Replied 12 August 2009
Dear Friend
You can open an account as Exchange Loss/Gain and maintain whatever the Loss or Profit arises out of the transaction. If its Loss at the end of the period it can be charged under P & L. If its gain U may treat the same as Misc Income.
CA Sk Hasan Ali
(Chartered Accountant)
(37 Points)
Replied 13 August 2009
Dear friend
Thank u for your kind reply. My doubt is whether that difference is exchange difference?
Treatment in financial statement is a later question.
CAclubindia
