Order Amending National Accounting Standard 21 Regarding Foreign Currency Transactions
The order introduces changes to the National Accounting Standard (NAS) 21 concerning the reflection of foreign currency operations. The main essence of the changes relates to the procedure for converting currency transactions into reporting currency and clarifying definitions of monetary and non-monetary items. Structurally, the order contains four main changes to NAS 21: a new version of the paragraph on initial recognition of foreign currency transactions, supplementation with definitions of monetary and non-monetary items, and technical clarifications of formulations in other provisions.
Key innovations:
• Enterprises are allowed to reflect non-cash currency transactions at the exchange rate applied by the bank when performing the operation
• Clear definitions have been introduced for monetary items (right to receive a fixed amount of money) and non-monetary items (absence of such right)
• Terminology regarding ‘economic transactions’ has been clarified for unambiguous interpretation of the standard’s provisions
