ankit goyal (CA Final Student) (102 Points)
16 March 2008hi all,
as you know our AS 11 talks that any forex fluctuation arising at the time of payment to supplier or else should be recognised as an expense or gain and charged to P&l. but as per sec 145 A of income tax act it should be capitalised to the cost of fixed asset. so what we should do
Srivathsan Rangarajan
(Chartered Accountant)
(66 Points)
Replied 20 March 2008
The answer is there in your question itself. Exchange difference will hit the P&L as far as statutory accounts are concerned and will be eliminated from the taxable income to be added to the cost of fixed assets as far as Income tax filings are concerned. This will also have a deferred tax implication.
GST Live Certification Course (39th Batch) - April 2024 (Weekend Batch) (With Certificate)
"Live class on Python for Financial Analysis: Unlocking Efficiency in Accounting and Finance"
CAclubindia
