ACCOUNTING TREATMENT FOR DIFFERENCE IN FOREIGN EXCHANGE RATES

[S.C. WADHWA]

A company imported machinery in month of Jan'14 from Sinagpore and installed and put to use before 31/03/14 but payment for same was made in May'14.

Please advice how foreign exchange difference will be dealt with as on 31/03/14.

AI Summary

Accounting for Foreign Exchange Differences on Machinery Imports: Consult AS-11 for Guidance on Treatment A company imported machinery from Singapore in January 2014, installed and used it before March 31, 2014, but made the payment in May 2014. The query raised concerns about the accounting treatment for the foreign exchange difference as of March 31, 2014. The response advised consulting Accounting Standard 11 (AS-11) for guidance on handling such foreign exchange differences. The replies provided a reference to AS-11 for further details on the accounting treatment.