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AS-11 Query
Wats the final take on the capitalisation of excahnge diiference inrt borrowings taken in foreign exchange. Does it have to be capitalised for limited companies or charged off to p&l a/c?
Replies (2)
If the diff is after development starts it is to be capitalized...
Both the treatment are allowed till there is no amendment in companies act schedule VI.But if any company continue to capitalize such exchange difference auditor cannot qualify the audit report because wherever there is contradiction in treatment between AS & Law ,law prevails. I think such amendment in companies act will be made in New companies act which will be introduced in parliament shortly.
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