What is the procedure for handling currency exchange rates on returns?

The Exchange Rates Handling Policy is essential for managing how currency exchange rates are applied to transactions, especially in cases involving returns. This policy outlines the procedures for determining which exchange rates will be used, such as whether to use the rate when the original transaction occurred or the rate at the time of the return. It ensures consistency in financial reporting and helps mitigate discrepancies that may arise from fluctuating exchange rates.

In situations where a return is processed, this policy will guide the organization in deciding how to adjust the values of the returned items in different currencies. By adhering to a well-defined exchange rates handling policy, businesses can maintain accurate accounting records and ensure fair treatment for customers, regardless of currency fluctuations over time. This is particularly critical in financial environments that handle multiple currencies, as it provides clarity and structure to the process.

While other options may pertain to specific aspects of currency management, they do not encompass the comprehensive approach that a handling policy offers in the context of returns.