Long-term foreign currency monetary items option allows capitalization or amortization of exchange differences under amended AS 11. The amendment inserts an option in AS 11 allowing exchange differences on long term foreign currency monetary items to be (a) added to or deducted from the cost of a depreciable capital asset and depreciated over its remaining life, or (b) accumulated in a Foreign Currency Monetary Item Translation Difference Account and amortized over the balance period of the related long-term asset or liability; the option applies to items with a term of twelve months or more, is irrevocable when exercised for an enterprise, and requires disclosure of the option and amounts remaining to be amortized.
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Provisions expressly mentioned in the judgment/order text.
Long-term foreign currency monetary items option allows capitalization or amortization of exchange differences under amended AS 11.
The amendment inserts an option in AS 11 allowing exchange differences on long term foreign currency monetary items to be (a) added to or deducted from the cost of a depreciable capital asset and depreciated over its remaining life, or (b) accumulated in a Foreign Currency Monetary Item Translation Difference Account and amortized over the balance period of the related long-term asset or liability; the option applies to items with a term of twelve months or more, is irrevocable when exercised for an enterprise, and requires disclosure of the option and amounts remaining to be amortized.
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