Home › CA Inter › accounting › IFO Translation Monetary › For an Integral Foreign Operation, monetary item…
For an Integral Foreign Operation, monetary items at the year-end are translated at:
AClosing rate (year-end exchange rate)
BHistorical rate
CAverage rate for the year
DForward rate
Answer & Solution
Correct answer: A. Closing rate (year-end exchange rate)
1. Step 1: Per AS 11, monetary items of IFO are translated at the closing rate.
2. Step 2: Non-monetary items at historical cost remain at historical rate.
3. Step 3: Hence (B).
_Source: ICAI BoS CA Inter Paper 1, Ch 15 "Accounting for Branches including Foreign Branches"_