Skip to content

CA Final · Financial Reporting · Ind AS 21 The Effects of Changes in Foreign Exchange Rates

Himalaya Foods Ltd's CFO states three views about differences between Ind AS 21 and IAS 21: (I) Ind AS 21 contains the transitional provisions of IAS 21 in full; (II) Ind AS 21 requires the date of change in functional currency to be disclosed in addition to the fact and reason; (III) Ind AS 21 includes paragraph 7AA to scope out certain long-term foreign currency monetary items. Which combination is correct?

Only views II and III are correct. Ind AS 21 requires disclosure of the date of change in functional currency and includes paragraph 7AA scoping out certain long-term foreign currency monetary items. View I is wrong because transitional provisions are in Ind AS 101, not Ind AS 21.

  1. AI and II only
  2. BI and III only
  3. CII and III onlyCorrect
  4. DI, II and III

Explanation

View I is wrong: the appendix says IAS 21 transitional provisions are not given in Ind AS 21 because all transitional provisions are in Ind AS 101. View II is correct because Ind AS 21 adds disclosure of the date of change. View III is correct because paragraph 7AA scopes out the D13AA-exempted items.

Did you get it right without looking?

One question tells you little. A timed set on Ind AS 21 The Effects of Changes in Foreign Exchange Rates shows your real accuracy, how long you take and where you lose marks.

Practise Ind AS 21 The Effects of Changes in Foreign Exchange RatesFree diagnostic mock

More Ind AS 21 The Effects of Changes in Foreign Exchange Rates questions