As-11 exchange gain/loss on depb incentives

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Querist : Anonymous

Querist : Anonymous (Querist)

24 November 2011 We are exporting Fibre to various customers residing out of the India and due to that we are eligible for DEPB incentive scheme of 5% introduced by Government. We take provision on the basis of actual sales, however We made application for DEPB only after actual realization of goods exported. There is a difference in incentive amount because of difference in actual realization and actual sales booked. Here, the issue is, whether we can book this difference as a foreign exchange gain/loss as per AS-11.

Your expert advice is requested.

Dheeraj Sharma

Dheeraj Sharma (Expert)

25 November 2011 Hi,

Difference you are talking about is purely because of exchange difference, same can be treated as Exchange gain/loss as per AS - 11.

Further, if you go by accounting entries in your case you will have more clarity.

Regards,

Message likes : 1 times

Querist : Anonymous

Querist : Anonymous (Querist)

27 November 2011 Dear Dheeraj,

Thanks for the reply

The issue is we will get benefit from Indian Government and there wont be any foreign curreny transaction. Difference arises due to foreign exchange transaction which we had at the time of export sale.

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