Inventory Capturing - Help Please!!

[adam001]

Good Day,

Hope there is someone out there that can help me, please.
When capturing imported stock bought on credit from a foreign supplier, what exchange rate date should be used? Invoice date or date of goods received?
Another question, at the end of the month, is inventory revalued at the spot rate on the last day of the month by a journal entry in the inventory account and P/L account. Since these goods are still on credit, or is only the foreign creditor amount revalued to correctly reflect the foreign debt amount.
Thanks and any advice very very welcome!

[Andromeda]

Hi adam001, you recognise the cost at the rate on the day you recognise the liability.

The payment gives rise to an exchange rate variance in the income statement.

Any inventory on hand and/or amount owing at year end must be converted to ZAR at that date, and the difference is charged against or credited to income.

By extension, you should do the same if you formally report during the year.

[SoTrue]

Hi adam001, you recognise the cost at the rate on the day you recognise the liability.

The payment gives rise to an exchange rate variance in the income statement.

Any inventory on hand and/or amount owing at year end must be converted to ZAR at that date, and the difference is charged against or credited to income.

By extension, you should do the same if you formally report during the year.

You can't "convert" the stock at year end or at any time after receipt thereof because it is in ZAR. You only convert/translate the remaining liability/debt.

[Andromeda]

Of course you are right, forgive the error.