Please explain how foreign exchange gain or loss is calculated and booked in books of accounts. For e.g, I have raised an invoice in USD to my client on date x when rate was (lets say Rs.65). Client paid me on date Y when rate was 63. I received money in my bank a/c on date Y but I converted on date Z when the rate was Rs. 70.
What is my exchange rate gain/loss to be booked in books of accounts. What would be treatment according to income tax.
27 July 2016
are you authorised to hold your account in any currency other than INR?
(If the invoice is say USD 100 ......booked at INR65...i.e.INR6,500.....In reality you recd USD100, duly converted into INR 6,300........INR 200 shall be considered as exchange fluctuations loss.... please note...beig in India , you are recording your books of accounts in INR only and not USD)