Declaration authentication by responsible persons for (VAT Return 9.1)

corporate practice bd

Realization of export proceeds refers to the actual receipt of payment from the buyer (importer) for the goods exported. The accounting treatment for the realization of export proceeds involves recording the receipt of funds and updating relevant accounts. Here's how it's typically handled:

1. Recording Initial Export Sale:

   • When the initial export sale is made, the revenue is recognized in the books.
   • Debit: Accounts Receivable (to record the amount receivable from the buyer)
   • Credit: Sales Revenue (to recognize the export sale)

2. Receipt of Export Proceeds:

   • When the payment is received from the buyer, the export proceeds are realized.
   • Debit: Bank Account (to record the funds received)
   • Credit: Accounts Receivable (to clear the outstanding amount)

3. Foreign Exchange Gains or Losses (if applicable):

   • If the export proceeds are received in a currency different from the local currency, there might be foreign exchange gains or losses due to currency fluctuations between the sale and receipt dates.
   • Debit/Credit: Foreign Exchange Gain/Loss Account (to record the currency gain or loss)
   • Credit/Debit: Bank Account (to reflect the actual amount received after conversion)

4. Settlement of Export Incentives (if applicable):

   • In some cases, exporters might be entitled to government incentives or benefits that are realized upon receipt of export proceeds.
   • Debit: Export Incentive Receivable (to clear the outstanding incentive)
   • Credit: Revenue from Export Incentives (to recognize the incentive income)

5. Reconciliation of Export Receivables:

   Regularly reconcile the export receivables account with the actual receipts to ensure accuracy in the books.

6. Document Retention:

   Maintain copies of relevant documents such as invoices, bills of lading, and payment receipts as part of your accounting records.

It's important to follow the accounting standards and practices relevant to your country and industry. Additionally, consider consulting with your organization's accountants or financial advisors to ensure that the accounting treatment aligns with your specific circumstances.

Practical Example-01

The ABC Company LTD, Produce & Yarn sales 15,000 Kg .Average Production capacity -18,000kg, Sales are occurred between In-house & other party.

After 120 days, final settlement the bill bank send realize voucher copy to the client of The ABC Company LTD,

 

Currently, the ABC Company LTD, sales their in-house party XYZ LTD, 7cd (BCI) 5000kg@$2.00=$10,000 Exchange BDT @92.per Dollar, Amount of TK.9, 20,000,

Finally bill of exchange are prepared, after Acceptance the bill, our commercial department already submit the bill to the Bank for 90% discounting.

 Bank after discounting the bill, already Acceptance copy & discounting voucher at dated 30.04.2023 & sent to the client Mail ID. Accounting department of The ABC Company LTD, Print the copy’s & also takes necessary following action.

 

SL NO.	Particulars	Debit(TK)	Credit(Tk.)
01	Bill discounting Journal 90% against bill value($10,000*90%*92) dt.30.04.2023
	CD A/C no.57948	8,28,000
	Bank charge(export)	600
	SIBL-IBP-23/2566L,LC-120506070		8,28,600
	(To record 90%  discounting the bill)
02.	Bank deduct  Tk.300 against LC advising charge
	Bank charge(Export)	300
	CD A/C no.57948		300
	(To record LC advising charge by bank)
03.	After 120 day Final settlement the bill$(10000*10%)
	SIBL-IBP-23/2552L,LC-120506070	8,28,600
	CD A/C no.57948(SIBL)	51677
	Interest on LIB(SIBL)Tk{(.828600*10.10%/360)}*120 days	27896
	Export bill collection Charge($9*108.50)	977
	Advance income tax(AIT@1% of LC value)(SIBL)$10,000@1%*108.50	10850
	Party -XYZ Company ($10,000@92)		9,20,000
	To record Final settlement bill LC value $ 10,000received$ 476.2857@108.50 dt.28.08.2023