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Hi may i know for asset purchase overseas,
what is the rule for the exchange rate?
Is it only using spot rate? For what instances should we use forward rate/closing rate/average rate of exchange? (if ever there was such a question) non monetary we should not retranslate and monetary we should retranslate to functional currency?Hi,
When we enter into a transaction, it is initially recorded at the rate in place on the day of the transaction.
At the reporting date the monetary items are translated a the closing rate, and gains/losses taken through profit and loss. Non-monetary items are not translated.
It will not get more complex than than this at this level.
Thanks
Hi,
Thank you for that. Please enlight me more on the next level complexity… as im planning to finish my acca this year entirely.
Hi,
Sorry but I’m here to help you through FR and going any further with complexities will not help you in the slightest.
I’d recommend that you work the examples/questions on functional currency in the study text and revision kit and you won’t go too far wrong.
Thanks
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