Dear friends please clarify this doubt...
An exchage house gets converted its local currency to USD by way of transferring amount from its local currency account to USD a/c maintained in same bank. In this process its local bank gives some discount in conversion rate by way of passing a single credit entry monthly. My doubt is whether such discount is exchange difference?
Dear Friend
You can open an account as Exchange Loss/Gain and maintain whatever the Loss or Profit arises out of the transaction. If its Loss at the end of the period it can be charged under P & L. If its gain U may treat the same as Misc Income.
Dear friend
Thank u for your kind reply. My doubt is whether that difference is exchange difference?
Treatment in financial statement is a later question.
CAclubindia
