Ind AS 21 - Accounting of Foreign Exchange transactions

[Guest]

What is the exchange rate to be adopted while booking in the Books of Account in case of Imports when advance has been paid.

Eg - Advance paid on 01/03/2017 - 100$ ($ = 69)

date of Bill of entry 10/03/2017 - 150 $ ($ = 70).

At which exchange rate the entry shall be posted in the Books of Account?

[Govind Gupta]

in my view, the rate should be transaction date rate ( meaning when actual advance has been given and such amount both INR and USD will be available from the bank statement), also bill of entry date is not relevant as advance might have been paid before the good would have been received.

AI Summary

Exchange rate for advance imports: use the transaction date rate when booking the advance in accounting records. Adopt the rate prevailing on the transaction (advance payment) date when booking an import advance in the books, using the bank statement evidence of INR and foreign currency amounts; the bill of entry date is not relevant to the initial accounting of the advance.