03-30-2009, 06:11 PM
Dear Kamran,
Agreed the differnce shall go to P&L in the form of gain or loss eventually.
I think there is involment of some sort of hedging in the transaction when exchange rate is agreed before the purchase through contract of sale or purchase.
What will be the accounting treatement when such contract of sale fall in one reporting period, purchase transaction in other reporting period and settlement in third reporting period. Reporting period is quarter.
Is the excecution of contract of sale in which exchange rate is fixed invites in the recognition of derivative because exchange rate is hedged through forward contract with seller.
Regards,
*
Agreed the differnce shall go to P&L in the form of gain or loss eventually.
I think there is involment of some sort of hedging in the transaction when exchange rate is agreed before the purchase through contract of sale or purchase.
What will be the accounting treatement when such contract of sale fall in one reporting period, purchase transaction in other reporting period and settlement in third reporting period. Reporting period is quarter.
Is the excecution of contract of sale in which exchange rate is fixed invites in the recognition of derivative because exchange rate is hedged through forward contract with seller.
Regards,
*
