If the exchange rate increases beyond this rate on the date of withdrawal, the additionalloss on translation of liability will be debited to the profit and loss account.

When an entity translates their foreign currency into the functional currency oftheir enterprise, any resulting loss on translation should be recognized in an entity’s profit and loss account.

A loss on translation is the amount of money that is lost by a company by converting another currency usedin a transaction into the functional currency of the company.