[CFM62410] Foreign exchange: matching: bringing amounts back into account: regulation 9 example
Example of transaction to which regulation 9 applies
This guidance applies only to exchanges of shares for QCBs happening before 6 April 2010
Dromsall plc has a wholly-owned investment subsidiary incorporated in Jersey, Dromsall (Jersey) Ltd, which accounts in US dollars and has net assets of $20 million. The group's accounting date is 31 December.
Dromsall plc partially hedges its investment in the subsidiary by an external loan of $10 million, commencing on 1 January 2003. The following exchange gains or losses on the loan are taken to reserves: