Carrying amount of a non-monetary item
How is the carrying amount of a non-monetary item determined on a valuation date for a foreign currency transaction?
The carrying amount is determined by comparing the cost or carrying amount, as appropriate, translated at the exchange rate at the date when that amount was determined (ie, the rate at the date of the transaction for an item measured in terms of historical cost); and the net realisable value or recoverable amount, as appropriate, translated at the exchange rate at the date when that value was determined (eg, the closing rate at the end of the reporting period). The effect of this comparison may be that an impairment loss is recognised in the foreign currency but would not be recognised in the functional currency, or vice versa.
