CALCULATION OF DAILY EXCHANGE POSITION: OUTWARD BILL PURCHASED. REF: FEPD CIRCULAR LETTER NO. 22 DATED 17.07.2013.

Attention of the Authorized Dealers (ADs) is invited to the Guidelines for Foreign Exchange Transactions (GFET), Vol.-2 (Edition-2010), paragraph 22, Chapter 2, Sl. No. 1.A. id (Outward bill purchased) of the Appendix 48A and 48B regarding calculation of ‘daily exchange position’ of authorized dealers.

For better understating of calculation of daily exchange position, it is clarified that the existing text of the said paragraph and the related title under the above mentioned serial numbers of Appendices 48A and 48B shall be replaced as follows:

1.A.id: Foreign currency bills purchased

Banks have different methods of entries for foreign and inland bills purchased which are denominated as well as receivable in foreign currency against direct/deemed exports. If a bank inputs the value of any such bill purchased immediately into their currency account, then such transaction need not be reported under this head. On the other hand, some banks debit their bills purchased to a temporary suspense account and transfer to their currency account when the bill is realized. When the exchange position is prepared before realization of the bill(s), the total outstanding purchased export bill (foreign and inland denominated as well as receivable in foreign currency) should be reported under this head. Moreover, any outstanding payment liability in foreign currency (if any) against such purchased bills are to be deducted while reporting under the said head. After realization of bills, such transactions are to be reported in local book and the respective head will be adjusted accordingly. The amount of bills sent for collection shall not be reported under this head.

Other instructions of to paragraph 22, Chapter 2 of GFET, Vol.-2 (Edition-2010) will remain unchanged.

Please bring the contents of this circular letter to the notice of all concerned.

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