Section 43A - Special provision consequential to changes in rate of exchange

Foreign exchange adjustment for imported assets alters asset cost and written down value when payment of foreign currency obligations occurs.

Section 43A requires that exchange variation on assets acquired from abroad via foreign currency loans or supplier credit, realized in the previous year when payment is made to the foreign supplier or in repayment of the borrowing used to acquire the asset, be added to or deducted from the actual cost of the asset or specified categories of capital expenditure; the resulting figure is treated as the cost for depreciation and acquisition purposes, and the adjustment correspondingly alters the written down value of the block of assets.