My query is , what is the accounting entry supposedly passed for forex cancellation? For cancellation -- I am doing 'cash settlement'.
Currently, for accounting symbol(currency swap) I have assigned an expense account.
So right now the entry being passed is
Cancellation Expense Dr./Cr.
Forex Position Dr./Cr.
The amount is the differential inflow/outflow amount in payment currency (based on the spot rate for cancellation).
Now the requirement is , on cancellation-- differential amount and some nominal bank charges entries are passed in the book of accounts.
Is the above listed entries correct? If not, what are the standard entries? How do I take care of the additional charges being posted?
Edited by: Sur Mits on Dec 7, 2009 9:33 AM