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Exchange differences on translation of an Integral Foreign Operation are:
AAccumulated in FCTR
BRecognised in P&L of the period
CCapitalised
DNot recognised at all
Answer & Solution
Correct answer: B. Recognised in P&L of the period
1. Step 1: Per AS 11, IFO is treated as part of the parent; exchange differences flow to P&L.
2. Step 2: This contrasts with NIFO where differences go to FCTR.
3. Step 3: Hence (A).
_Source: ICAI BoS CA Inter Paper 1, Ch 15 "Accounting for Branches including Foreign Branches"_