Glossary · Accounting

What is Exchange difference on formation of the charter capital?

The amount arising from the difference between the Central Bank exchange rates on the date the founding documents were registered and on the date the money was actually contributed, when a founder contributes a share to the charter capital in foreign currency. A positive difference is recorded in account 8420 as additional capital; a negative difference is covered first from the positive difference in this account, and any excess from account 9620.

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