CO129-519-4 Adjustment of exchange account- payment of military contribution on profit on exchange 10-9-1929 - 10-6-1931 — Page 5

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contribution on book profits would then not

arise. These suggestions were adopted.

(1) The "Exchange Account" reappeared in the

1926 Accounts. (2) According to paragraph 1 of

the present despatch, the total profits on

sterling transactions, "i.e. the direct sterling appreciation of securities realized as well as the appreciation in the dollar values of the

original investments, due to lower exchange,"

have been carried to revenue.

In 1925 and 1926 it was found necessary to

realize investments wholesale. The dollar

equivalent of the sterling appreciation was

carried to Revenue and Military Contribution

was paid thereon.

The nett dollar appreciation of the

original sterling value of investments was calculated for the years 1920-26 as $2,307,700.60

and in 1926 this sum also was carried to

Revenue. The corresponding Military

Contribution ( 461.540.13) was, however, not

paid but was placed provisionally in a "Suspense

Acco unt Military Contribution."

C1

This circulation was based on the rate

of exchange when each realization took place, whereas the Adjustment of Exchange Account

(see above) was calculated on the basis of the

The resulting December rate of exchange.

discrepancy of $367,715.66 was written back to

the 1928 Revenue and Expenditure Account from the Adjustment of Exchange Account.

It is

not