Professional Documents
Culture Documents
Forex Differences
Monetary Items - Gain or Loss allowed on MTM Basis as in AS 11
Other items – adjusted as in AS – not taken as income or loss
Foreign Operations
Integral Foreign Operations (LO, warehouse) – as if own operations
Translate as described above- Monetary / Non-Monetary (latter at rate on Transaction date)
Non Integral Foreign Operations (Branch) – fully recognised as Inc/ Exp
Classification of Foreign Operations
What constitutes Integral & Non integral – same as in AS
ICDS VIII – Part B deals with securities held by Banks & Public
financial institutions
Applicability to Insurance Cos, MFs, VCs, NBFCs, FIIs?
Securities acquired in exchange of another security /
asset, actual cost will be the FV of security / asset
acquired
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ICDS VII – SECURITIES
Securities - recognised at actual cost
i.e. purchase price, brokerage, fees, tax, duty, cess. STT included in
actual cost – section 40(a)(ib) omitted wef 1.4.2005.
Pre-acquisition period interest
ICDS allows broken period interest for pre-acquisition
period to be reduced from actual cost, only balance
interest received taxable -American Express International
Banking Corporation 258 ITR 601 accepted. Vijaya Bank 187 ITR 541
(SC) – not applied in case of Interest on Securities.
Revenue recognition standard applies
No such adjustment provided for sales proceeds
Thank You
(This is just a background material to facilitate discussion)
Jayant Gokhale
FCA Mumbai
jayant@gokhalesathe.in
For
Accounting and Auditing Committee of
The Chamber of Tax Consultants
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