03-25-2009, 08:27 AM
my question is whether accruals, such as accrued bonus, accrued annual leaves etc or provisions, such as provision created in anticipation of penalty or lawsuit, if these amounts are calculated in foreign currency during the year, using transaction rate at the date of booking the said accrual/provision, should it be translated at the year end spot rate?
are these monetary items liable to be translated at year end spot rate or not??
as i read in ias 21, provisions settled in cash are categorized as monetary items.
please explain whether these two items should be translated or not
1- provision for penalty US$ 100(estimated amoount payable in 2009) booked in June 2008 @ Rs.60 = Rs. 6,000 if closing spot rate is 80..
then at year end will it be shown in books at 6000 or 8000?
are these monetary items liable to be translated at year end spot rate or not??
as i read in ias 21, provisions settled in cash are categorized as monetary items.
please explain whether these two items should be translated or not
1- provision for penalty US$ 100(estimated amoount payable in 2009) booked in June 2008 @ Rs.60 = Rs. 6,000 if closing spot rate is 80..
then at year end will it be shown in books at 6000 or 8000?
