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As per IAS 21 the depreciation of the asset will be posted on the spot rate or an average rate. The asset is recorded in a historical rate. Thus, the asset is fully depreciated in the functional currency but still a balance is shown the reporting/presentation currency at the year end. Is this treatment correct. If so, what should be done to the balance in the functional/presentation currency.
in IAS 21 - The Effects of Changes in Foreign Exchange Rates by

1 Answer

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Property, plant and equipment are nonmonetary assets. Property, plant and
equipment purchased in a foreign currency should be initially measured and recorded
in an entity’s functional currency using the exchange rate on the date it is acquired. It
should not be subsequently remeasured for changes in exchange rates during the
period it is held.
by Level 4 Member (9.8k points)


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