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Hi, I have a few questions in regards to forex and subsidiaries.
1) At which rate (spot, average,etc.) are the non-monetary items translated?
2) Is foreign exchange gain/loss recognised when translating a subsidiary?
3) If recognised, where are they recognised? Is the gain or loss taken through PnL or OCI?I reckon translation difference in the individual accounts is taken through PnL, but for the case with the subsidiary, I’m confused.
I know this should be in SBR Forum,but I got no reply.
Thank you.
1.Non monetary items should not retranslate at year end only monetary items like payable, receivables, cash in foreign currency should be retranslated and any gain or loss should be recorded in SPL.
2.Gain or loss from retranslating of subsidiary should be included in other comprehensive income
I hope you it would be help for you.
@aaradhya33 said:
Hi, I have a few questions in regards to forex and subsidiaries.1) At which rate (spot, average,etc.) are the non-monetary items translated?
2) Is foreign exchange gain/loss recognised when translating a subsidiary?
3) If recognised, where are they recognised? Is the gain or loss taken through PnL or OCI?I reckon translation difference in the individual accounts is taken through PnL, but for the case with the subsidiary, I’m confused.
I know this should be in SBR Forum,but I got no reply.
Thank you.
1. Non monetary is historical rate (temporal method)
2. Under translation method- OCI… Recognise the gain or loss
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