Forex gain arising from the core activities of a company which has suffered loss for the fiscal year. Is the gain subject to tax? Substantiate.

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The IFRS IAS21 The Effects of Changes in Foreign Exchange Rates, requires that forex loss or forex profit is a separately disclosure item on the face of the Statement of Comprehensive Income (SOCI).  Forex profit / loss from operating activities without hedging would be in the profit and loss section of the SOCI. Depending on the type of hedging, cashflow hedge and Foreign Exchange Translation of foreign operation will be line items in the section called "Other Comprehensive Income" of the SOCI.

Forex losses and Forex profits are either realised or unrealised.  The unrealised forex profit/loss is those monetary items are those that are translated at closing rate of exchange as at reporting date. The foreign monetary asset or liability must be revalued as at year end date.  These are an IFRS drafting transaction, and are not REALISED.  These specific transactions are added back (losses) and deducted (profits) from the accounting profit to obtain the taxable profit.

REALISED PROFITS / LOSSES, which arose during the trading year on executed, actually received or actually paid, are not adjustments to the income tax computation and would form part of revenue subject to income tax at the legislated tax rates of the country where the management office is domiciled. 

Accounting Standard No.13 issued in1997 cares accounting differences currency standard allows alternative address if exchange differences influential related originated the acquisition of fixed asset where the standard allows the inclusion of these differences in the carrying value of the asset, provided they increase the value of the original for the replacement value, and thus the value of the currency differences consumption the age of the original, but I doubt that the processors contained criterion considered Maajat ideal to be followed by companies in the preparation of financial statements, and should be respected by the IRS so that the right to subdue the exchange rates payable for the tax differences with the recognition of discounting differences city for consistency, fairness and stability tax situation.

Agree with Mr. George..........................

Thank you for the invitation to answer

.I agree with Professor answers

Agreed with the answer Ms. Bonnie Cheryl Nel

I think as this gain is part of the core business of the company, so he returned to the total advantage of the company and is therefore part of the loss he has suffered

I agree with both MRS Bonnie Cheryl & MR GEROGI answers  

agree with mr  georgei assi

agree with answers >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>