4 Replies Latest reply: Mar 29, 2011 9:20 AM by Murali Babu Nallamothu RSS

Accounting entries at the time of Foreign currency valuation.

Abhijit Bhatia
Currently Being Moderated

Dear All,

 

I wanted to know about the accounting entries generated while doing a

 

a) Foreign currency valuation and

b) Automatic payment programme.

 

Please help me in getting the accounting entries for both the situations.

 

Thanks in advance!

 

Abhijit

  • Re: Accounting entries at the time of Foreign currency valuation.
    Shilpa Ambiti
    Currently Being Moderated

    Hi,

     

    1)

    Foreign Currency valuation if we have done account assigment in OBA1  for KDB is

     

     

    If loss then

     

    Exchange loss acc dr 100

    To Gl (SBI loan account)  100

     

     

    If Profit then,

     

    GL (SBI Loan Acc) Dr. 200

    To exchange gain account 200

     

    These entries will be reversed in the next month beginning if the valuation is done on a monthly basis.

    If it is a year end valuation reversal will not happen.

     

    2)

    Foreign Currency valuation if we have done account assigment in OBA1  for KDf is, here we use the balance sheet clearing ccount along with the exchange gain and loss account.

     

    If loss then,

     

    Exchange loss Acc Dr 100

    To b/sheet adj accoutn 100

     

    If gain

    B/sheet adj acc dr.

    To exchange gain account.

     

    Thanks,

    Shilpa.

  • Re: Accounting entries at the time of Foreign currency valuation.
    Chintan Joshi
    Currently Being Moderated

    Hi,

     

    You have got answer of Accounting Entries for Forex Valuation in Thread by Ashilpa

     

    For APP, there is no difference afterall it is payment regardless of effort so entry will be same

     

    Vendor Dr.

    Bank GL Cr.

     

    Regards,

    Chintan Joshi

  • Re: Accounting entries at the time of Foreign currency valuation.
    Abhijit Bhatia
    Currently Being Moderated

    Hi Shilpa and Chintan,

     

    Thanks for your immidiate response.

     

    Shilpa, when are you saying while doing valuation in OBA1 for KDB types the entry is

     

    Exchange loss acc dr 100

    To Gl (SBI loan account) 100

     

    Is it the Bank account you are trying to credit or any specific loan account you are trying to credit? Since you have mentioned as SBI loan account, I am bit confussed over here. Can we say it as bank account simply?

     

    Hi Chintan,

     

    Is it the only entry getting generated while doing the foreign currency valuation

     

    Vendor Dr.

    Bank GL Cr.

     

    No entries except the above takes place at all?

     

    Thanks to confirm.

     

    Best regards,

    Abhijit.

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