Finance Costs
The following break up of finance costs is required to be disclosed in the notes :
- Interest expense
- Other borrowing costs
- Applicable net gain/ loss on foreign currency transactions and translation.
- Interest expenses : it includes interest on borrowings from banks and others, interest on debentures, bonds or similar instruments.
- Other borrowing costs include commitment charges, loan processing charges, guarantee charges, loan facilitation charges, discount/premium on borrowings and other ancillary cost.
- Thus, gain/ loss on foreign currency transactions to be shown under 'finance costs' should be limited to this extent. As regards other such foreign exchange loss/ gain, it should be shown separately under appropriate head.