Two bases can be used for exchange rate conversions – actual rate on day cost incurred (if dual currency accounting used in books of account) or the rate on the day following the last day of the reporting period. The EU view is that audit costs should be include in the period that the expense is paid (i.e. not normal GAPP rules) and not accrued. Thus, although the audit cost for the current period’s report is included in box 6 of form C, the cost in the first year will not be in direct costs - box 2 (as management activity, but as subcontractor with no overheads added). Thus when paid the rate will be according to the system for period 2 (or reporting period when paid). The exception to this “rule” is the final period, where the audit fee for the final report should be accrued and included in direct costs (management – as subcontractors with no overheads added). Thus in final period there may be the cost of audit for two periods. | 
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