I hope I have come to the right place.
I know this question is posted after 4 years but I need clarity in regards to multi currency Debtor (AR) transactions:
1. Should we recognize Credit Note for (partial or full) reversal or returns of Sales/Service at original rate or current rates?
2. Should we recognize for (partial or full) Credit for Write Off to Expense at original rate or current rates?
For 1 I feel it should be original rates because we are merely accepting sales returns for sales that originally took place (reversing original Sale), hence use of original rates. If we use current rates, the relevant Sales/Trading accounts would be off balance rather than cancelling out.
For 2 above it is tricky for example a write off to Bad Debt, Bank charges etc but my hunch is to use current rates because we are recognizing the expense at the current time of the credit memo.
What is the right thing to do?
