Page 10 - 15. COMPILER QB - INDAS 21

QUESTIONS FROM PAST EXAM PAPERS

Q10. (May 19 – 5 Marks) (Newly Added in ICAI Module)

XYZ Global Ltd. has a functional currency of USD and needs to translate its financial statements into the
functional and presentation currency of XYZ Info (Euro).
The following is the statement of financial position of XYZ Global Ltd. prior to translation:
USD Euro

Property, plant and equipment 60,000
Receivables 9,00,000
Total assets 9,60,000
Issued capital 40,000 25,000

Opening retained earnings 25,000 15,000
Profit for the year 22,000
Accounts payable 8,15,000

Accrued liabilities 58,000
Total equity and liabilities 9,60,000
Additional information:
Relevant exchange rates are:

Rate at the beginning of the year - Euro 1 = USD 1.25
Average Rate for the Year Euro 1 = USD 1.20
Rate at the end of the year Euro 1 = USD 1.15
You are required to:
 Translate the statement of financial position of XYZ Global Ltd. into Euro which is ready for consolidation
by XYZ Info. (Share capital and opening retained earnings have been pre-calculated.)

 Prepare a working of the cumulative balance of the foreign currency translation reserve as per relevant Ind
AS.
SOLUTION

TRANSLATION OF THE FINANCIAL STATEMENTS
USD Rate/Euro Euro
A b a/b
Property, plant and equipment 60,000 1.15 52,174
Receivables 9,00,000 1.15 7,82,609
Total assets 9,60,000 8,34,783
Issued capital 40,000 25,000
Opening retained earnings 25,000 15,000
Profit for the year 22,000 1.20 18,333
Accounts payable 8,15,000 1.15 7,08,696
Accrued liabilities 58,000 1.15 50,435
Total equity and liabilities 9,60,000 8,17,464

Foreign Currency Translation Reserve
17,319
Total equity and liabilities 8,34,783
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