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Hello Sir, for non-monetary asset and liabilities that carried at fair value, “translate at the rate when fair value was establish”
is it mean translate it when fair value took place and retranslate it at the year-end one more time like monetary asset and liabilities?
or is it mean translate it at the year-end at the rate when fair value is established which only translate one time and no retranslate?Thank you.
on individual f/s:
initial classification: on the date of transaction @ historical rateSubsequent:
If monetary ( anything thts readily convertible to cash)
– retranslated at RD (reporting date @closing rate CR)
g/l : soplif non monetary ( NCA etc)
– Not retranslated ie @HR
-unless item is at FV then revalue to FVOn group:
SOFP – A/L @CR
(g/w @ CR but SNA @DOA and SRE pre acqui @HR)
SOPL – Y/Exp @average rate (AR)Dispose OCI
where is chris.. i miss chris
@toushiga said:
Hello Sir, for non-monetary asset and liabilities that carried at fair value, “translate at the rate when fair value was establish”is it mean translate it when fair value took place and retranslate it at the year-end one more time like monetary asset and liabilities?
or is it mean translate it at the year-end at the rate when fair value is established which only translate one time and no retranslate?Thank you.
Hi,
If we have a non-monetary asset, such as PPE, that is revlaued to fair value and is held in an overseas currency then we have to translate the fair value in order to recongise the increase in fair value. We therefore use the rate on the date the revaluation to fair value is performed in order to translate the new value of the asset. Any gain in this example goes through OCI as it is due to the revaluation. I think there is an example in the class notes if memory serves me right.
Thanks
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