188体育

CG78327 describes an approach to computing gains and losses in connection with a foreign currency bank account where there are many transactions. This paragraph provides a worked example to illustrate that approach.

Consider an account denominated in US dollars to which TCGA92/S252(2) (sums representing currency acquired for personal expenditure) does not apply. The account is subject to many credit and debit entries in the course of a year. The monthly totals of credits and debits are as shown below. Also shown is the monthly average exchange rate for sterling to dollars.

-	Total credits/$	Total debits/$	Avge exchange rate
April	7520	5000	0.504400
May	8100	6500	0.508768
June	7570	7575	0.508343
July	9230	6800	0.502694
August	6730	9250	0.528316
September	8210	5420	0.554933
October	7970	6400	0.589352
November	6990	7500	0.651597
December	15730	17650	0.672184
January	5580	4530	0.690832
February	7260	7240	0.692636
March	8340	7950	0.704384
TOTAL	99230	91815	听

The dollar (credit) balance at the start of April is $75,425 and the total allowable cost of the asset is 拢49,383.

The period of aggregation is one month. The computation begins with April. The results of computations are rounded to the nearest whole number before being used in further computations.

April gain/loss

Step 1: Add the total of the dollar credits in April to the opening balance:

$75,425 + $7,520 = $82,945

Step 2: Determine the expenditure allowable in respect of this by translating the April credits into sterling using the average exchange rate:

拢49,383 + (7,520 x 0.5044) = 拢53,176

Step 3: Determine the dollar balance carried forward by deducting the total of the debits in April:

$82,945 - $5,000 = $77,945

Step 4: Determine the allowable expenditure attributable to the debit amount using the A/(A+B) fraction applied to the total allowable expenditure as computed above:

5000/(5000+(75,425 + 7,520 - 5,000)) x 拢53,176 = 拢3,205

Step 5: Compute the gain or loss on the disposal:

Proceeds 拢2,522 (5,000 x 05044)

Allowable expenditure 拢3,205 see above

Loss 拢683

Step 6: Compute the allowable expenditure in respect of the $77,945 balance carried forward by deducting the expenditure allowed in this computation:

拢53,176 - 拢3,205 = 拢49,971

Repeat the process for each successive month, carrying the dollar balance and the remaining allowable expenditure forward to the next month:

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May gain/loss

Step 1 (Dollar balance before debits): $77,945 + $8,100 = $86,045

Step 2 (total allowable expenditure): 拢49,971 + (8,100x0.508768) = 拢54,092

Step 3 (Dollar balance carried forward): $86,045 - $6,500 = $79,545

Step 4 (apportion allowable exp.): 拢54,092 x 6,500/(6,500+77,945+8,100-6,500) = 拢4,086

Step 5 (compute gain or loss): (6,500 x 0.508768) - 拢4,086 = LOSS 拢779

Step 6 (allowable expenditure carried forward): 拢54,092 - 拢4,086 = 拢50,006

The results of the computations are shown in the following table:

-	Step 1	Step 2	Step 3	Step 4	Step 5	Step 6
-	Dollar balance before debits.	Total allowable expenditure	Dollar balance carried forward	Exp. re allowed disposal	Gain or loss	Allowable expenditure carried forward
April	$82,945	拢53,176	$77,945	拢3,205	拢683 loss	拢49,971
May	$86,045	拢54,092	$79,545	拢4,086	拢779 loss	拢50,006
June	$87,115	拢53,854	$79,540	拢4,683	拢832 loss	拢49,171
July	$88,770	拢53,811	$81,970	拢4,122	拢704 loss	拢49,689
August	$88,700	拢53,245	$79,450	拢5,553	拢666 loss	拢47,692
September	$87,660	拢52,248	$82,240	拢3,230	拢222 loss	拢49,018
October	$90,210	拢53,715	$83,810	拢3,811	拢39 loss	拢49,904
November	$90,800	拢54,459	$83,300	拢4,498	拢389 gain	拢49,961
December	$99,030	拢60,534	$81,380	拢10,789	拢1,075 gain	拢49,745
January	$86,960	拢53,600	$82,430	拢2,792	拢337 gain	拢50,808
February	$89,690	拢55,837	$82,450	拢4,507	拢508 gain	拢51,329
March	$90,790	拢57,205	$82,840	拢5,009	拢591 gain	拢52,196
TOTAL	-	-	-	-	拢1,025 loss	-