Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AAA Exams › Exchange difference
- This topic has 1 reply, 2 voices, and was last updated 7 years ago by MikeLittle.
- AuthorPosts
- June 3, 2017 at 9:02 am #389859
Hi sir
Should exchange difference be recognized in OCI or P&L?
Monetary assets or non-monetary exchange differences must be recognized where?Thank you
June 3, 2017 at 9:11 am #389871Non-monetary items are translated at the date that obtained on the date the non-monetary items were acquired
So only monetary items should give us pause for thought (with one exception)
This is an extract from the IASPLUS page on IAS21:
“Exchange differences arising when monetary items are settled or when monetary items are translated at rates different from those at which they were translated when initially recognised or in previous financial statements are reported in profit or loss in the period, with one exception
The exception is that exchange differences arising on monetary items that form part of the reporting entity’s net investment in a foreign operation are recognised, in the consolidated financial statements that include the foreign operation, in other comprehensive income; they will be recognised in profit or loss on disposal of the net investment”
So, almost always the difference is recognised in the statement of profit or loss
OK?
- AuthorPosts
- The topic ‘Exchange difference’ is closed to new replies.