외환 번역

IAS 21 '환율 변동 효과'.

클릭당 비용 (CPD)

글.

그레이엄 홀트.

클릭당 비용 (CPD)

글.

그레이엄 홀트.

그레이엄 홀트 (Graham Holt)는 외화로 거래되는 거래를 회계 할 때 환율의 중요성을 설명합니다.

이 기사는 회계 및 비즈니스 잡지 2009 년 3 월호에 처음 게시되었습니다.

이 기술 기사를 공부하고 관련 질문에 대답하면 CPD 단위 경로를 따르고 있으며 콘텐츠가 학습 및 개발 요구와 관련이있는 경우 확인 가능한 CPD에 반영됩니다. 한 시간의 학습은 한 단위의 CPD와 같습니다. 자신을 CPD 단위로 할당 할 때 이것을 지침으로 삼는 것이 좋습니다.

IAS 21의 목적은 외화 및 외상 거래의 회계 처리 방법을 설정하는 것이다.

이 표준은 재무 제표를 재무 제표를 표시하는 통화 인 표시 통화로 변환하는 방법을 보여줍니다. 이것은 기업이 영업하는 주요 경제 환경의 통화 인 기능 통화와 대조됩니다.

주요 쟁점은 환율과 환율 변동 효과가 재무 제표에 기록되는 곳입니다.

기능 통화는 2003 년 개정 된 IAS 21 '외화 환율 변동 효과'에 소개 된 개념입니다. IAS 21의 이전 버전은 통화보고 개념을 사용했습니다. 2004 년 IAS 21을 개정함에있어 IASB의 주요 목표는 번역 방법에 대한 추가 지침을 제공하고 기능 통화 및 표시 통화를 결정하는 것이 었습니다.

기능 통화는 몇 가지 요인을 고려하여 결정되어야합니다. 이 통화는 기업이 정상적으로 현금을 창출하고 소비하는 거래와 정상적으로 거래가 이루어지는 통화이어야합니다. 기능 통화가 아닌 통화의 모든 거래는 외화 거래로 취급됩니다.

기업의 기능 통화는 기업이 사업을 수행하는 거래, 사건 및 조건을 반영합니다. 일단 결정되면 거래 및 관련 조건 및 이벤트의 근본적인 성격에 변화가 없으면 기능 통화가 변경되지 않습니다.

화폐 성 항목에 발생하는 외환 차이는 한 가지 예외를 제외하고는 당기 손익으로보고됩니다. 단, 해외 사업장에 대한보고 기업의 순 투자의 일부를 구성하는 화폐 성 항목에서 발생하는 외환 차이는 별도의 자본 구성 요소 내에서 그룹 재무 제표로 인식됩니다. 그들은 순 투자의 처분으로 당기 손익으로 인식하고 있습니다. 비 화폐 성 항목의 손익이 자본으로 인식되는 경우 (예 : 유형 자산 및 유형 자산이 IAS 16에 따라 재평가 된 경우) 외환 손익은 자본으로 인식한다.

프리젠 테이션 통화 및 기능 통화.

기업은 재무 제표를 모든 통화로 표시 할 수 있습니다. 표시 통화가 기능 통화와 다른 경우 재무 제표는 표시 통화로 재 환산됩니다. 기업의 재무 제표가 초 인플레이션 경제의 기능 통화가 아닌 경우에는 다음과 같이 표시 통화로 환산된다.

자산과 부채 (취득시 발생하는 영업권 및 공정 가치 조정 포함)는 해당 대차 대조표 일의 마감 시점 환율로 환산됩니다. 손익 계산서는 거래일의 현물 환율로 환산됩니다 환율 변동이 크지 않은 경우) 모든 외환 차이는 별도의 자본으로 인식합니다.

기업 수준에서 경영자는 IAS 21의 요구 사항에 따라 기업의 기능 통화를 결정해야한다.

기업은 기능 통화를 선택할 수 없습니다. 기능 통화 외의 모든 통화는 외화로 취급됩니다. 기업의 경영진은 재무 제표를 제시 할 수있는 기능 통화 (표시 통화)와 다른 통화를 선택할 수 있습니다.

그룹 수준에서, 다국적 그룹 내의 다양한 엔티티는 종종 서로 다른 기능 통화를 가질 것입니다. 기능 통화는 각 그룹 엔티티에 대한 엔티티 레벨에서 식별됩니다. 각 그룹 실체는 결과와 재무 상태를보고 기업의 표시 통화로 환산한다.

연결 실체가 재무 제표를 적절한 표시 통화로 준비하면 연결 재무 제표를 작성하기위한 정상적인 연결 절차를 따릅니다.

외국 작업의 번역.

그룹 계정을 준비 할 때 외국 자회사의 재무 제표는 위에 명시된 바와 같이 표시 통화로 변환되어야합니다. 영업권과 공정 가치 조정은 해외 기업의 자산과 부채로 처리되므로 매 결산기마다 종가 기준 액으로 재조정됩니다.

그룹 내 항목의 외환 차이는 자본으로 분류되는 기업의 해외 사업에 대한 순 투자의 환입의 결과가 아닌 한 당기 손익으로 인식합니다.

자회사가 모회사에 외화로 지불 한 배당금은 모회사의 재무 제표에 외환 차이가 발생할 수 있습니다. 연결시 제거되지 않지만 손익으로 인식됩니다. 해외 사업장을 처분하는 경우 처분 손익이 인식되면 해외 사업장과 관련된 자본 차이의 누적 금액을 당기 손익으로 인식합니다.

결론.

IFRS에서는 그룹 기능 통화의 개념이 존재하지 않는다. 기능 통화는 순전히 개별 개체 또는 비즈니스 운영 기반 개념입니다. 이로 인해 IAS 21은 IFRS로 전환하는 기업의보다 복잡한 표준 중 하나가되었습니다.

또한 많은 다국적 그룹은 이러한 과정이 시간이 많이 걸리고 어려움을 겪었습니다. 특히 비 무역 기관 그룹을 고려할 때, 외부 요인에 대한 표준의 강조는 회사 자회사의 기능 통화가 법인 설립 국가 또는 거래가 표시된 통화.

IFRS를 적용하는 기업은 기능 통화의 평가가 그룹 구조의 변경이나 새로운 헤지 또는 세금 전략의 실행을 고려할 때 핵심 단계임을 기억해야합니다. 또한 그룹 내의 기업 활동이 어떤 이유로 든 변경된 경우, 필요한 변경을 식별하기 위해 해당 기업의 기능 통화의 결정을 재검토해야합니다. 경영진은 모든 경우에 걸쳐 일관된 방법론을 사용하여, 특히 판단을 요구할 때 특히 그룹 내의 각 사업체에 대한 기능 통화의 결정에 따라 접근법을 문서화해야합니다.

사례 연구 1.

기능 통화로 달러를 사용하는 기업은 2008 년 5 월 31 일 € 2에서 $ 1에 이르는 외국 기업으로부터 공장을 1800 만 유로에 구매합니다. 회사는 2008 년 9 월 30 일에 환율이 1.75 ~ 1 유로 인 10.5 백만 유로에 외국 고객에게 물품을 판매합니다. 2008 년 12 월 31 일 기업의 연말에 두 금액은 여전히 미 지불 상태이며 지급되지 않았습니다. 마감 환율은 1.5 ~ 1 달러였습니다.

2008 년 12 월 31 일 종료 회계 기간의 항목 회계는 다음과 같습니다.

회사는 2008 년 5 월 31 일에 플랜트 및 부채를 9 백만 달러로 기록합니다. 연말에 금액은 지급되지 않았습니다. 따라서 거래 마감 환율을 사용하면 미지급 금액을 1200 만 달러로 환산 할 수 있으며, 이로 인해 3 백만 달러의 손실이 발생합니다. 자산은 감가 상각 전 9 백만 달러에 머물러 있습니다.

기업은 6 백만 달러의 판매 및 매출 채권을 기록 할 것입니다. 연말에 매출 채권은 7 백만 달러로 환산 할 것이고 이는 1 백만 달러의 손익을 손익으로보고하게된다. IAS 21은 외환 손익이 포괄 손익 보고서에 표시되어야하는 부분을 명시하지 않는다.

사례 연구 2.

기업은 100 % 소유의 해외 자회사를 보유하고 있으며, 이 자회사의 장부 가치는 $ 25m입니다. 자회사를 2008 년 12 월 31 일에 € 45m에 판매합니다. 2008 년 12 월 31 일 현재, 이 자회사와 관련된 교환 준비금의 신용 잔액은 6 백만 달러입니다. 기업의 기능 통화는 달러이며 2008 년 12 월 31 일의 환율은 1 달러에서 1.5 유로입니다. 처분 일 자회사의 순자산 가치는 $ 28m이었다.

자회사는 4500 만 달러를 150 만 달러로 나눠서 판매되기 때문에 3000 만 달러입니다. 상위 엔티티의 계정에는 5 백만 달러의 이익이 표시됩니다. 그룹 재무 제표에서 준비금의 누적 환산 이익은 처분 이익과 함께 당기 손익으로 대체 될 것입니다. 매각 이익은 3,000 만 달러에서 2 천 8 백만 달러를 뺀 것이므로 2 백만 달러는 판매 수익과 자회사 순자산 가치의 차이입니다. 여기에 교환 준비금 잔액이 6 백만 달러가 추가되어 총 8 백만 달러의 이익이 발생하며, 이는 포괄 손익 계산서에 포함됩니다.

그레이엄 홀트 (Graham Holt)는 맨체스터 메트로폴리탄 대학교 비즈니스 스쿨 (Princeton Metropolitan University Business School)에서 ACCA 심사관이자 회계 및 재무 담당 수석 강사입니다.

관련된 컨텐츠.

IFRS 마인드를 만드는 방법.

IFRS Foundation의 교육 구상은 IFRS Conceptual Framework에 기반을두고 있다고 Graham Holt는 설명합니다.

클릭당 비용 (CPD)

새로운 UK GAAP.

영국의 새로운 재무보고 기준 (Financial Reporting Standard)은 일관성을 도입하고 오늘날의 비즈니스 요구 사항에 맞추어 표준을 신속하게 도입하고자합니다. Graham Holt가 설명합니다.

클릭당 비용 (CPD)

비재무 정보에 대한 유럽 지침의 요구 사항.

Graham Holt는 비재무 및 다양성 정보에 대한 유럽 지침의 주요 요구 사항에 대해 설명합니다.

덜컹 거리는 상인의 여행.

거시 경제학, 가치 투자, 양적 금융 및 회계에 대한 학습 및 사고.

외화 거래 및 해외 사업 회계 (IAS 21)

IAS 21 : 환율 변동 효과.

외화 거래.

외환 거래의 수명주기.

최초 인식 외화 금액을 거래일의 현물 환율로 기능 통화로 환산합니다. 예 : Dr of Univivables, Cr Sales with Yen (US $ 100 * 100) 기 결산보고 통화 항목 현금, 채무, 매출 채권 기간 종료 시점의 마감 환율로 재 번역 예. Cr 미수금, 엔화 강세로 인한 손익 계산서 (교환 손실), 엔화 강세로 인한 비 화폐 성 항목 재고 자산, 비유동 자산 재고 자산, 비유동 자산 재고 자산, 비유동 자산 인식 금액 공정 가치로 재평가 된 경우에는 FV 조정일의 환율로 재 번역해야합니다. 정산 결제시 환율을 사용하여 다시 번역 예. 현금 약화 엔 (US $ 100 * 90), Cr 미수금 (US $ 100 * 80), Cr 손익 계산서 (Exchange gain)와 엔화 약 US $ 100 * (90-80). 재 번역 또는 결제시 환산 된 환율 (기능 통화 기준)은 P & L에 인식됩니다. 비 화폐 성 항목에 대한 손익이 OCI에서 인식된다면 그 항목에 대한 환산 차이는 OCI에서도 인정되어야합니다.

해외 사업장의 통합.

재무 상태 보고서.

마감 환율로 환산 (보고 일의 환율)

포괄 손익 계산서.

거래는 개별 날짜로 번역됩니다. 합당한 경우 모든 거래에 단일 평균 요율을 사용할 수 있습니다.

연결 재무 상태 표

정상적으로 통합을 수행하십시오. 영업권 해외 Sub의 기능 통화로 계산 된 후 종가로 재 변환됩니다. 이전에 사용 된 이자율은 취득일의 이자율입니다. 외환 차이는 OCI에서 인식되고 지분 내 외환 보유고로 인식됩니다. 학부모의 예비비 Sub & # 8221;의 투자 비용에 대한 외화 획득 / 손실을 추가하십시오. = 영업권 계산서와 일치시키기위한 투자 비용 * (종결 율 & 취득 률).

OCI에서보고를위한 Exchange 차이 계산.

외국환 준비금 모든 교환 차이에 대해 자본으로 별도의 외환 준비금 (이익 잉여금이 아님)이 생성됩니다. 모든 교환 차이는 OCI (P & amp; L이 아님)에서 인식되고 별도의 준비금으로 유입됩니다. 이 예비비는 해외 사업장이 처분 될 때까지 유지 될 것이다. 총 교환 이익 / 손실은 그룹의 준비 운동 (쉬운 길)에서 균형을 이룬 수치입니다. 개회 그룹 준비금 올해의 이익 & # 8211; 배당금 + 총 교환 이익 / 손실 = 기 결산 준비금 총 교환 이익 / 손실 = 순자산 종결에 따른 환차익 / 손실 + 영업권의 환차익 / 손실 (어려운 방법) 순손실 거래 & # 8221; = 순자산 결산 * 결산율 & # 8211; (영업 자산 순자산 * 영업 이익 + 잠정 수익) * 영업권 환산 손익 = 영업권 결산 * (결산 률 및 개시 률) 그룹의 환매 이익 몫 / 손실 = 영업권 + 그룹의 교환 이익 / 손실 Sub * Exchange 이익 / 손실의 순손실에 대한 관심 NCI의 Exchange 이익 / 손실 = NCI의 Sub * Exchange 이익에 대한 관심 / 순손실 결산 손실 부모의 예비비 증가 (어려운 방법) Sub & # 8217;의 이익 몫 (= Group의 Sub * Sub에 대한 관심은 해당 연도의 이익) * Average rate ) + 그룹의 Exchange 이익 / 손실 점유율 NCI (어려운 방법) NCI의 순자산 지분 = 하위 NCI 지분 * 취득시 순자산 * 취득시 이자율 + 취득 후 이익의 NCI 지분 = NCI Sub *이자 이익 * 취득 후 이익 * 평균 이자율 + NCI의 Exchange 이익 / 손실 분담금 NCI (쉬운 방법) NCI의 하위 순자산 * 순자산 마감 * 결산율.

Sub 처리 중 OCI의 Exchange Gain / Loss 처리.

IAS 21 환율 변동 효과

진실은 우리, 사람들, donвЂ ™ t가 격리 된 체재하고 싶다이다. 우리는 판매, 구매, 수입, 수출, 무역 등을 비롯하여 다른 많은 것들을 모두 외화로 즐기고 있습니다!

비즈니스 세계를 살펴보면 두 가지면에서 글로벌 비즈니스가 이루어지는 것을 볼 수 있습니다. 외화 거래가 개별적으로 이루어 지거나 규모가 커지면 외국 사업 (해외 비즈니스 분리)을 설정하는 경우가 있습니다.

또한 환율은 1 분마다 변경됩니다. 그렇다면이 통화 구성에 약간의 조직을 도입하는 방법은 무엇입니까? 그 в ™ ™ 왜 표준 IAS 21 외환 환율의 변화의 효과가 있습니다.

IAS 21의 목적은 무엇인가?

IAS 21 '환율 변동 효과'의 목적은 다음을 규정하는 것이다.

기업의 재무 제표에 외화 거래 및 해외 사업장을 포함시키는 방법; 재무 제표를 표시 통화로 변환하는 방법.

즉, IAS 21은 다음 두 가지 기본 질문에 답변합니다.

우리는 어떤 환율을 사용할 것인가? 재무 제표의 환율로 인한 손익을보고하는 방법은 무엇입니까?

기능성 대 프리젠 테이션 통화.

IAS 21은 기능 통화와 표시 통화를 모두 정의하고 그 차이를 이해하는 데 중요한 itвЂ ™ s :

기능 통화는 기업이 영업하는 주요 경제 환경의 통화입니다. 그것은 자신의 entityвЂ ™ s 통화이고 다른 모든 통화는 вЂњign 통화 вЂ are입니다.

표시 통화는 재무 제표가 표시되는 통화입니다.

대부분의 경우 기능 통화와 표시 통화가 동일합니다.

그러나 기업은 재무 제표를 기능 통화와 다른 통화로 표시하기로 결정할 수 있습니다. 예를 들어 외국의 모회사에 대한 통합보고 패키지를 준비 할 때.

또한 기업은 기능 통화가 1 개뿐이지만 기업이 재무 제표를 더 많은 통화로 제시하기로 결정하는 경우 1 개 이상의 표시 통화를 가질 수 있습니다.

또한 기업이 실제로 표시 통화를 선택할 수는 있지만 해당 기능 통화를 선택할 수 없음을 인식해야합니다. 기능 통화는 몇 가지 요인을 평가하여 결정해야합니다.

기능 통화를 결정하는 방법.

기능 통화를 결정할 때 가장 중요한 요소는 그것이 작동하는 엔티티의 주요 경제 환경입니다. 대부분의 경우 엔티티가 운영되는 국가가되지만 이는 반드시 사실 일 필요는 없습니다.

주요 경제 환경은 일반적으로 기업이 주로 현금을 창출하고 소비하는 환경입니다. 다음 요인을 고려할 수 있습니다.

어떤 통화가 주로 상품과 서비스의 판매 가격에 영향을 미칩니 까? 인건비, 재료비 및 기타 비용은 어떤 통화로 표기되고 결제됩니까? 금융 활동으로 인한 자금은 어떤 통화로 생성됩니까 (대출, 발행 된 지분 상품)? 그리고 다른 요인들도 마찬가지입니다.

때로는 판매 가격, 인건비 및 자재 비용 및 기타 항목이 다양한 통화로 표시 될 수 있으므로 기능 통화는 분명하지 않습니다.

이 경우, 경영진은 기본 거래, 사건 및 조건의 경제적 효과를 가장 충실히 대표하는 기능 통화를 결정하기 위해 판단을 사용해야합니다.

기능 통화로 거래를보고하는 방법.

초기 인식.

처음에 모든 외화 거래는 거래일에 기능 통화와 외화 사이의 현물 환율을 적용하여 기능 통화로 환산됩니다.

거래일은 IFRS에 따라 자산이나 부채의 최초 인식 조건이 충족되는 날입니다.

후속보고.

그 다음에 각보고 기간이 끝나면 다음을 번역해야합니다.

마감 환율로 외화로 표시된 모든 화폐 성 항목; 모든 비 화폐 성 항목은 거래일 (과거 환율)의 환율을 사용하여 역사적 원가로 측정됩니다. 공정 가치로 측정 한 비 화폐 성 항목은 공정 가치가 측정 된 날의 환율을 사용하여 공정 가치로 측정됩니다.

외환 차이를보고하는 방법.

모든 환율 차이는 다음 예외를 제외하고는 당기 손익으로 인식한다.

비 화폐 성 항목의 환 율 손익은 항목 자체의 손익 인식과 일관되게 인식됩니다.

예를 들어, 항목이 다른 포괄 손익으로 인식 된 재평가로 평가되는 경우 해당 손익의 환율 변동분도 OCI에서 인식됩니다. 외국 기업에 대한보고 기업의 순 투자액의 일부를 구성하는 화폐 성 항목의 환율 손익은 다음과 같이 인식한다. 분리 된 기업 в ™ ™ 또는 외국 사업 Ђ 재무 제표 : 손익; 연결 재무 제표에서 : 최초에 다른 포괄 손익으로, 이후에 해외 사업에 대한 순 투자를 처분함에 따라 그 차액은 당기 손익으로 재 분류한다.

기능 통화로 변경합니다.

기능 통화가 변경되면 변경 일로부터 새 기능 통화와 관련된 번역 절차를 전진 적으로 적용합니다.

재무 제표를 프레젠테이션 통화로 변환하는 방법.

기업이 기능 통화와 다른 표시 통화로 재무 상태를 표시하는 경우, 그 규정은 기업이 비 초 인플레이션 경제로 운영되는지 여부에 따라 달라집니다.

비 초 인플레이션 경제.

entityвЂ ™ s 기능적인 통화가 hyperinflationary 경제의 통화가 아닌 경우에, 실재물은 번역해야한다 :

각 재무 상태 보고서의 모든 자산과 부채는 재무 상태 보고서 일자의 마감 환율을 사용하여 표시합니다 (비교 표시 포함).

이 규칙은 영업권 및 공정 가치 조정에도 적용됩니다. 거래일의 환율을 사용하는 모든 수입과 지출 및 기타 포괄 손익 항목 (비교 항목 포함).

표준 IAS 21은 실질적인 이유로 일부 기간 평균 환율을 사용할 수 있지만보고 기간 중 환율 변동이 심한 경우 평균 사용이 적절하지 않습니다.

결과로 발생하는 모든 외환 차이는 별도의 자본 구성 요소로 기타 포괄 손익으로 인식한다.

그러나 기업이 해외 사업장을 처분하는 경우 해당 해외 사업장과 관련된 외환 차이의 누적 금액은 처분 손익이 인식되면 자본에서 당기 손익으로 재 분류한다.

초 인플레이션 경제.

entityвЂ ™ s 기능적인 통화가 hyperinflationary 경제의 통화 일 때, 접근은 경미하게 변화합니다 :

엔티티의 현재 연도 в ™ ™ 재무 제표는 IAS 29 '초 인플레이션 경제에서의 재무보고 (Financial Reporting in Hyperinflationary Economies)'에서 요구하는대로 먼저 재 작성됩니다. 비교 수치는 이전보고 기간의 재무 제표에서 현재 연도 вЂ ™ s 수치와 동일하게 사용됩니다. 그런 다음에는 위에서 설명한 것과 동일한 절차가 적용됩니다.

IAS 21은 공개 건수도 규정하고있다. 다음 비디오를 IAS 21 요약본과 함께 보시기 바랍니다.

외국환 환율을 사용하는 것이 확실하지 않은 적이 있습니까? 이 동영상 아래에 댓글을 달고 여기를 클릭하여 친구와 공유하지 마십시오. 고맙습니다!

무료 보고서 Top 7 IFRS 실수.

당신이 피하는 + IFRS 미니 코스!

회사가보고에서 얻은 7 가지 IFRS 실수를 알아보고 쉽게 피하는 방법!

귀중한 IFRS 미니 코스도 받게됩니다.

무료 보고서를 받으려면 아래 양식을 작성하십시오.

100 % 프라이버시와 스팸 없음, 우리는 약속합니다.

136 의견 :

안녕 silvia, 이 설명에 너무 고마워. 기능 통화와 표시 통화의 차이를 이해하지 못했습니다. & # 8230; 지금은 분명하고 감사합니다.

안녕 Silvia, 이 기사 및 영상에 당신의 좋은 일을 감사하십시오. 다른 상황에서 사용 된 통화를 판단하는 데 실제로 도움이되는 사람들. 너의 좋은 일을 계속해라. 고마워.

다음 두 문장은 항상 나를 혼란스럽게 만듭니다.

결과로 발생하는 모든 외환 차이는 별도의 자본 구성 요소로 기타 포괄 손익으로 인식한다.

모든 환율 차이는 당기 손익으로 인식한다.

그걸 밝혀 주시겠습니까?

안녕하세요 Ezat, 당신의 혼란을 이해할 수 있습니다. 그렇게 쉽지는 않습니다. 첫 번째로 번역 해 주신 내용을 이해하십시오.

- 외화 판매, 구매 또는 다른 어떤 거래를 번역하고 있습니까? 이 거래를 자신의 (기능적) 통화로 번역하고 있습니까? 그런 다음 외화 차이는 P / L로 이동합니다.

- 전체 대차 대조표와 손익 계산서를 외화로 환산하고 있습니까? (통합 또는 기타 목적으로)? 그런 다음 전체 명세서를 표시 통화로 변환하고 결과로 발생하는 환율 차이가 OCI로 전달됩니다.

나는 회계 표준에 대한 일부 쿼리에 명시 적으로 응답하는 사이트를 찾고있었습니다. 이건 훌륭해! 이미 답을 얻었 기 때문에 Q를 게시하지 않을 것입니다. 나중에 참조 할 수 있도록 게시물을 보관합니다.

나는 당신의 마음과 성질이이 Q들을 어떻게 관리하는지 궁금합니다.

너는 소진되지 않을 것을 기대한다!

네가하는 일을 신의 축복이 있기를!

재미있는 질문은 당신에게 비밀을 말합니다. & # 8211; 이러한 질문이 충분하면 나는 손과 마음을 바쁘게 유지하려고 노력한다. 나는 바느질 일을한다 자수 최고야! 에스.

여보세요. 재무 제표가 기능 통화에서 표시 통화로 변환되는 경우 두 가지 질문이 있습니다.

1) 자산과 부채는 마감 환율을 사용하여 환산됩니다. 금전과 비 또는 모든 경우에 우리는 마감 환율을 사용합니까?

2) 형평은 어떨까요? 공유 자본, 공유 프리미엄, 이익 잉여금? 어떤 비율이 사용될 것입니까?

나는 당신이 정말로이 ias를 설명하는 것을 좋아한다. 그리고 나는 완전한 튜토리얼을 얻길 바란다. 그러나 나는 이집트 사람의 인생을 어떻게 보내 느냐? 모든 ifrs에 대한 모든 자습서를받는 방법을 알려줄 수 있습니다.

저는 비 초 인플레이션 경제와 초 인플레이션 경제 사이의 차이점을 원합니다. 감사.

Dinesh, 초 인플레이션 경제는 표준 IAS 29에서 논의된다. 초 인플레이션 경제에서의 재무보고와이 표준은 지침을 제공한다. 그러나 표준은 인플레이션의 절대 비율을 '과잉 인플레이션'으로 간주하는 국가, 즉 판단의 문제로 설정하는 것이 아니라 지침으로 제시한다. 예를 들어 누적 인플레이션 율 3 년이 100 %를 초과하거나 근접합니다.

Hyperinflation - Dinesh에게 당신의 회신 10 월 12,2014.

재 입력은 일반적인 가격 지수를 적용하여 이루어집니다. 대차 대조표 일 현재 이미 측정 단위에 표시된 화폐 성 항목과 같은 항목은 재 작성되지 않습니다. 기타 항목은 해당 항목이 취득되거나 발생 된 날과 대차 대조표 일자 사이의 일반적인 가격 지수의 변동에 따라 재 작성됩니다.

이 진술은 명확하지 않습니다. 좀 더 명확하게 이해할 수 있도록 도와 주시겠습니까? 외화 화폐 항목을 번역하는 데 환율이 적용되어야합니다.

이 설명을 해주셔서 고맙습니다. 제게 많은 도움이됩니다.

나는 작은 Q를 가지고 있는데, 우리의 은행 계좌 들간의 이동을 어떻게 설명 할 것인가? 하나는 우리의 기능 통화이고 다른 하나는 외화로되어있다.

우리가 번 돈을 나누어 외화 은행 계좌에 예금 한 경우, 그 후에 돈을 우리의 기능 통화 은행 계좌로 이체 했습니까?

이것은 IAS 21에 서술 된 것보다 더 실용적인 문제이다. 이는 자국에서 통화 문제가 어떻게 다루어 지느냐에 달려있다. 예를 들어 내 상황을 알려 드리겠습니다.

나는 EU 출신이며 기능 통화는 EUR입니다. 일부 지불액이 미화로 USD 계좌에 도착하면 계좌의 USD로 표시되지만 회계 기록의 경우이 금액을 EUR로 환산해야합니다. IAS 21에 따라 거래일 (화폐가 도착한 시점)의 환율을 사용해야합니다. 우리의 법안에 따라, 그것은 거래 이전 날짜에 유럽 중앙 은행 (ECB)이 정한 금리가 될 것입니다. & # 8211; 이는 자국에서 다를 수 있지만, 이 특별한 경우에는 상업 은행이 아닌 중앙 은행 세율을 고려해야합니다.

안녕 실바. 노력을 감사하십시오.

여기에서 내가 알아야 할 것은 해외 자회사의 개별 재무 제표를 모회사의 표시 통화로 환산 할 때 결과적 차이 (개인 FS의 별도 자본으로 인식)가 CRE 및 NCI를 각각 %로 표시 하였는가?

또한 인수로 발생한 영업권의 환율 차이는 부과 될 수 있습니까?

3 일 안에 시험을!

시험을보기에 너무 늦지 않기를 바랍니다. 답글을 달려면 :

1) 아니요, 모든 차이점은 CTD (통화 변환 차이)라는 한 줄로 표시됩니다. 그들은 쪼개지지 않는다.

2) 흠, 인수에 따른 영업권은 해외 자회사의 별도 재무 제표가 아니라 연결 재무 제표에만 나타나는 역사적인 항목이라고 생각합니다.

취득시 취득일에 실제 환율을 사용하여 영업권을 계산합니다. 현재 환율로 번역하는 아이디어가 마음에 들지 않습니다. & # 8211; 역사적인 자산이므로 환율은 다른 모든 외환 차이와 함께 분류됩니다.

시험에 도움이되고 행운이 있기를 바랍니다.

고마워 Silvia.

그리고 예, 우리는 취득일과 연말 결산율에 대해 영업권을 번역합니다 (나머지 자산과 마찬가지로). 왜냐하면 번역이 통합 목적으로 만 이루어지기 때문에 재무 상태의 모든 요소가 다루어지기 때문입니다.

정확함, IAS 21에서 요구하는 것. 나는 그것을 좋아하지 않는다. & # 8211; 내 개인 의견. 어쨌든, GW의 번역에서 발생하는 교환 차이는 OCI 구성 요소의 일부입니다. CTD & # 8221; 행운을 빕니다!

IAS 21이 무엇에 관한 것인지를 제대로 설명하고있는 온라인에서 찾은 유일한 자료는 당신 것입니다. & # 8211; 고맙습니다. 그러나 나는 그것을 100 % 이해하는 데 여전히 문제가있다. 나는 영국 주식 시장에있는 회사에 투자를하고 있습니다. 그들은 남아프리카에 본사를 둔 금광 회사입니다. 기능 통화는 ZAR이며 (영국 주주에게 연례 보고서를 공개 할 목적으로) 그들의 발표 통화는 스털링으로되어 있습니다. 가장 최근의 P & L 계정에 따르면 세금 후 이익은 2600 만 달러 였지만, 포괄적 인 소득의 경우 외화 환산 차이는 25 만 파운드에 달합니다! 따라서보고 된 이익을 거의 완전히 닦아냅니다.

나는 외화 환산 차이가 ВЈ25m에 달할 수있는 것을 해결할 수 없으며 연간 보고서에 설명 할 메모가 없습니다 (아무도 눈치 채지 않기를 바랄 것입니다!).

OCI의 외화 환산 차이는 내가 CTD & # 8221; 또는 & # 8220; 통화 변환 차이 & # 8221; 이는 회사가 재무 제표를 ZAR (기능 통화)에서 GBP (표시 통화)로 변환 할 때 자산 및 부채 (종가)를 환산하고 소득 및 비용 (평균 연이율)을 환산하는 데 다른 환율을 사용하기 때문입니다.

또한 OCI의 CTD가 누적 성 (cumulative)이라는 사실을 깨달을 필요가 있습니다. 현재보고 연도에만 발생하지는 않지만 재무 제표를 환산하는 최초의 날부터 표시 통화로 누적됩니다.

GBP 25m의 CTD는 아마도 누적 수치 일 것입니다. 전년도의 숫자와 CTD의 잔고를 살펴보십시오. 새로 생긴 CTD가 차이점입니다. 또는 손익 계산서 및 기타 포괄 손익 보고서를 볼 수 있습니다. 현재보고 연도에 CTD가 얼마나 많이 증가했는지 확인할 수 있습니다.

희망이 도움이됩니다! 에스.

고마워요 실비아 네, 물론 맞습니다, 올해의 OCI는 ВЈ25m이고 전년은 ВЈ20m이므로 ВЈ5m의 차이가 있습니다. 도와 주셔서 정말로 고맙습니다.

다음 문제들을 도와 주시면 감사하겠습니다 :

외환 거래 문제.

1. 초기 승인.

100 % 선급금이 특정 이자율로 지급되고 최종 송장이 예를 들어 입고됩니다. 다른 환율이 존재하는 2 개월. 따라서 사용 요금, 선금이 발급 된 환율 또는 실제 물품 수령일에 존재하는 요금.

2. 마감일에 조정되지 않은 상태로 남아있는 100 % 대출의 경우 마감 환율로 번역해야합니다.

3. 책임의 후속 승인.

외화 자산의 조달 - 부채의 결제시, 그 차이는 자산에 부과됩니다 (자산이 진행중인 작업 단계에있는 경우).

aaaaaa, advance payments – everybody treats that differently!

OK, but here’s my opinion:

1) If the advance payment was made for the specific asset (inventories or PPE), then do not revalue it, but simply treat a part of acquisition cost in the original FX rate of payment. The reason is that IAS 21 requires you to translate the foreign currency transaction with the rate AT THE DATE of transaction.

Now, what is the date of transaction? IFRS say that it is the day when the transaction appears for the first time in your financial statements. In this case, you start acquiring asset at the date of making prepayment.

2) Again, when it is an advance payment for the specific asset, it is non-monetary asset (as you have no right to receive cash… you are just expecting the non-monetary asset to be acquired). No revaluation.

3) IAS 16 does not permit capitalizing FX differences so to P/L.

Interestingly, and the analogue is?

But i still have that small doubt with regards to the translate the foreign currency transaction with the rate AT THE DATE of transaction. I am interpreting AT THE DATE of transaction as the date i recognize asset which i would do that when asset is actually received and not the date the advance is released , at the time of release of advance , asset is yet to be formed a such is not recognized in the books. For eg. if we had not released advance then asset would have been recognized on the rate the asset is received , so if i am to assume asset value would be recognized at the time of payment if no advance has been released.

I hope i am making sense.

Yes, it makes sense and I understand your doubts. Believe me, everybody is treating that differently as there’s no specific guidance in the standards for that.

Try to look at it in a different view: what is your real cost of acquiring the asset? Your real cash out? Part of it was done when you paid the advance payment. If you translate the advance payment with the rate of invoice, then you are effectively capitalizing foreign exchange rate differences (and you should not do it).

At the date of transaction = the first time when the transaction appears in your financial statements. Sure, if you don’t pay any advance, then it is the delivery date. But if you incurred real cost (payment) before that day…

There’s a lot of discussion going on about it. My opinion is that you should take your real cost.

Here also I have One Doubt.

At the date of transaction = the first time when the transaction appears in your financial statements. Sure, if you donвЂ™t pay any advance, then it is the delivery date. But if you incurred real cost (payment) before that dayвЂ¦

What will be the treatment if 50% advance is Paid and 50% paid one month after delivery. Which exchange rate should be applied for recording the purchases. Here date of Transaction is 50% advance payment date.

Really confused Forex Accounting .

Then what will happen if the asset is received ahead and payment is made few months later. So here also do we recognize asset two months later.

Sonam, since this discussion, I wrote an article about prepayments specifically, please refer here.

Dear Silvia, Thanks for creating and sharing these very good articles and videos. I watched the video and read the article on IAS 21 and have some query. I need to prepare individual subsidiary balance sheet and income statement on parent’s currency.

1. Do I retranslate forex gain/loss recognised in I/S in functional currency by using average rate in I/S of parent’s currency? Note, forex gain/loss include loan received from parent in parent’s currency.

2.Is it alright to recognise the gain/loss from exchange difference in retranslating net profit in closing rate in B/S and average rate in I/S as Other comprehensive income in I/S in presentation currency?

I would be really grateful if you kindly help me out on this two issues. 감사.

Thank you for these wonderful articles,

I would appreciate if you could help me in the following issue :

We have recorded one transaction in the month of Jan’15 by using the exchange rate prevailing on that date. Now we are required to reverse the transaction because it was posted inadvertently. The reversal entry should be passed in the month of March’15. Can we use the exchange rate we used while passing the original entry? Or should we use the exchange rate of March’15.

if that’s just annulation (as the transaction would have never happened), then do it with the original FX rate.

Thank you Silvia…

this is very informative. I cannot seem to find the answer here, (or anywhere), however, to an issue with our German subsidiary (parent is US based). Each month’s valuations for exchange rate are posted to the P&L, but we use an unrealized gain/loss account to do so. Our German subsidiary, though, posts all of its changes in the value of its cash bank accounts to Realized gain/loss, not unrealized. Both are hittin gthe P&L properly, so that is not a major issue. I am just trying to get an understanding whether theis is required by IFRS vs GAAP in the US which would just use unrealized gain/loss.

It is me again with tricking question… looking for a fresh view.

The Company has a contract with a constructor fixed at the local currency. At the same time the contract has a clause saying that in case the local currency depreciate against USD more than 3 points, the payment is to be increased by the difference in exchange rates. For example, total trade payable is 500 local currency (or 100 USD) at recognition and at the payment date the local currency depreciate to 60 per USD, therefore the final payment is to be made is 600 local currency.

The question is whether there is exchange loss and should it be capitalized to the constructed facility or recognized in PL.

It looks like that initially it is USD contract and no forex loss/gain is to be recognized (functional currency of the Company is USD). However if the difference is less than 3 points than no compensation is made and the forex gain is recognized on trade payable up to 3 points. Moreover, there is no mention if the local currency appreciates against USD (which did not happen in the past).

For me there is embedded derivative instrument, rather than USD Trade Payable and therefore IAS 39 applied. I am wondering whether you have different view? And how would you account for this transaction?

My South Africa branch purchases goods in USD from Japan/India.

Once supplier ship out the goods, my SA branch records liability in the books. (during this time the exchange rate ZAR to USD is say 11)

So system records liability in ZAR based on exchange rate of 11.

When the goods are actually received by SA branch, the exchange rate is 12. So while posting Goods Receipt, system identifies this difference of 1 (exchange diff) and Debit Merchandise a/c in BS and credits exchange gain account in PL. Is it correct?

Is it right to increase/decrease the inventory for exchange rate fluctuation? 제발 조언.

it depends on the terms of delivery – when the risks and rewards of ownerhip pass to your branch? And how is the initial transaction (when the supplier ships the goods) recorded? Inventories are non-monetary item and therefore, you should keep them at historical rate. The question is when the ownership passes to you – if it’s at the moment of shipping the goods, you should keep them at 11. S.

Thank you so much for your quick reply.

In this case the delivery term is FOB. So once the BL is issued, we need to recognize the liability. However goods may arrive after 1 month by which time, the exchange rate is changed. In this scenario, to which account we can charge this cost (if not merchandise). One side of the entry is clear i. e. is exchange gain/LOss to the PL. Pl advise.

In this case, the date of ownership transfer (and recognition of goods) is when the goods are loaded for transport. Since that point, it’s you who controls the goods. Therefore, you should use the historical rate of 11, also for posting the goods from goods in transit to goods in the warehouse. 에스.

If the fx change. is any effect on parant and subsidiary firm net profit.

A question on FX unrealized gains and losses for interco loans: we remeasure all outstanding IC BS positions using Group determined FX rates as of year end. And if we have long term loans is it possible to show these unrealized gains and losses from remeasurement in OCI as part of equity and exclude them from PNL? Under US GAAP it is allowed. But I did my research on IFRS and I can not fild an answer. As usually please help.

if you classify your loans as debt securities measured at fair value through OCI, then the foreign exchange gain/loss would be a part of fair value remeasurement and posted in OCI. This is the new category introduced by IFRS 9 and it is also covered in the IFRS Kit with example. 에스.

I am practicing in Nepal. Regarding the translation of Financial Statements into Reporting Currencies of parent Company the assets and liabilities were translated into reporting date exchange rate of Central bank and for translating the income statement yearly average rate has been considered. The Difference was presented in OCI. Please let me know whether this is correct? 감사.

Yes, that’s how you should translate the financial statements into the presentation currency. 에스.

If the Functional Currency of the Parent Company is USD and the Subsidiary is in SGD. Will a Capital injection from Parent Company in USD to the Subsidiary result in any exchange differences.

I have a question on how to determine functional currency for cost plus entity (IFRS) for entity A.

The fact pattern:

Entity A (MY)- principally involved in assembling and testing products for its immediate parent entity which is Entity B (US).

Entity A generate revenue under cost plus arrangement to Entity B under TP agreement.

Revenue is generated in USD (under cost plus model)

Direct costs is MYR (labor charges/direct materials).

based on this fact pattern, what will be the appropriate functional currency for Entity A and how to justify on the its?

Regards and thank you.

Kindly help with the treatment of exchange gains or losses in a forward contract arrangement (forward contract here is for construction of non current assets.

without knowing what the forward contract is about I can’t help really – not enough information. S.

My parent company has given a USD loan us (subsidiary ) 3 years ago and at that time they did not ask us to repay. therefore, we did not revalue the currency . But now we have to pay it. my questions are.

1. Do we need to revalue USD loan.

2. what possible way to reduce our big loss on this USD revaluation.

yes, you should have revalued this loan also in the previous periods under IAS 21. Now, clearly, you made an error as you have not applied IAS 21 properly. Therefore, I would calculate the profit or loss impact of revaluation in the previous periods and if it is significant or material, then I would make a correction in line with IAS 8.

This way, “big loss” on USD revaluation would be spread over 3 periods and a part of it would be recognized in equity as a correction of error.

Now its clear. Thank you for your great advice.

At year-end we had revalued goodwill that arised on consolidation at closing exchange rate and resulted in write-down which we have taken it to CTA in equity. Does changes in CTA balance will impact consolidated cash flow statement?

Me and my colleagues always have this arguement on whether to translate monetary items at the reporting date using “Buying” rate or “SElling” rate. I am of the argument that the rate at which i can buy the foreign currency should be used meaning the selling rate set by the bank. For example if my functional currency is USD and i need to translate EURO in to USD i should take the rate at which i can exchange USD to Euro right?

좋은 질문. Well, it depends on what’s available. In the EU, European Central Bank sets the rates for the other currencies and many companies simply use these rates, regardless the commercial rates of the bank.

However, IAS 21 in paragraph 26 states that when you have several rates available, then you should take the rate at which you would settle the liability or recover the asset at the measurement date. Practically it means – if you have USD receivable, then you use buying rate (you will receive USD and bank buys them to convert to EUR), and if you have USD liability, then you use sell rate.

어쨌든 & # 8211; you absolutely need to be consistent and use the same principles every time. Hope this helps! 에스.

Regarding the example that you gave with USD receivable, should we not use the buying rate for such an item ? Let me explain :

We have 1000 USD receivable from Debtor X. The presentation currency of our company is EUR.

USD to EUR – Buying rate : 0.75 (the bank is buying 1 USD for 0.75 EUR)

USD to EUR – Selling rate : 0.80 (the bank is selling 1 USD for 0.80 EUR)

Debtor X pays us the 1000 USD.

In the current context, I have obtained USD from Debtor X and to know the value of the USD in terms of EUR, i need to Sell this USD to the bank. This means that the bank would be Buying my USD and for each 1 USD, I would receive 0.75 EUR.

Based on that, should we not be using the bank buying rate for such a type of receivable ?

Of course, you are right! Corrected!

Thanks for your prompt reply Silvia.

I also have another question relating to the year end retranslation of balances. I’ve been browsing IAS 21 to obtain an answer to these but without success :

Upon retranslating all foreign currency monetary amounts to the presentation currency, there are gains and losses which arise.

Are all foreign exchange gains/losses accounted for as realised or unrealised ?

Could you also explain the logic behind classifiying the gains/losses as either realised or unrealised ?

when you translate to presentation currency, don’t calculate any gains or losses, simply translate. There will be difference between total assets and liabilities – this is currency translation difference presented in equity. 에스.

I would like to know what accounting entries would be made upon the year end translation of financial statements to the reporting currency.

Let’s take the below example :

Reporting currency of the business is USD. It has foreign debtors and creditors in EUR. Let’s assume only these 2 items to calculate the CTD at year end (31 Dec 2016).

Rate EUR to USD at 1 Jan 2016 : 1.5.

Rate EUR to USD at 31 Dec 2016 : 1.3.

Foreign debtors (EUR) at 1 Jan 2016 and 31 Dec 2016 : EUR 1000.

Foreign debtors (USD) at 1 Jan 2016 : USD 1500 (1000 x 1.5)

Foreign debtors (USD) at 31 Dec 2016 : USD 1300 (1000 x 1.3)

Foreign creditors (EUR) at 1 Jan 2016 and 31 Dec 2016 : EUR 2000.

Foreign creditors (USD) at 1 Jan 2016 : USD 3000 (2000 x 1.5)

Foreign creditors (USD) at 31 Dec 2016 : USD 2600 (2000 x 1.3)

From here on, how do we calculate the difference between assets and liabilities and how do we record the CTD as a separate component of equity at 31 Dec 2016 ?

미리 감사드립니다.

I am doing year end account for one of my client, they have an account in Euro and ending balance showing in GBB in my bookkeeping system is different if I use the actual exchange rate on the date. My understanding was the difference on exchange should reported in equity as Unrealised gain or loss the P&L. Please correct me if I am wrong.

that depends on what you’re trying to do. Are you translating foreign currency amounts to your functional currency? Then translation differences are reported in profit or loss, not equity. 에스.

Thank you for this. I appreciate your explanation.

Please kindly shed some light on the following.

Please for a financial statement, when you translate the bank Balances in foreign curency using the closing rate the gain or loss as a result of the translation-is it realized or unrealized?

If realized or unrealized what are the tax effect.

it’s realized (as any other foreign currency difference). The tax effect depends on the tax legislation of your country. 예 : in our country, these realized differences are optionally taxable (you can opt to tax them when they arise, or not to tax them at all). 에스.

Hi Silvia, could you please inform the gains/losses raised from the revaluation of bank balances in foreign currencies should be classified as realized or unrealized according to IFRS?

I assume you are translating into the functional currency. In this case, it’s realized in profit or loss (anyway, IFRS do not know the term “unrealized”). 에스.

Thanks for quick answer, my local Financial statement currency is EGP and my question is regarding reevaluating the bank balances in foreign currencies (the equivalent of these currencies in EGP in my books) the FX gains or losses appears is realized? I need your reply for my local reporting and for the consolidated report for my group (more than 1 company report)

Yes, these gains and losses are realized, that is in profit or loss. 에스.

I have following queries:

1. Exchange Gain or Loss – Realized and Unrealized: How to present it in financials.

вЂў As Raw material Cost i. e before gross margin.

вЂў As finance cost i. e after gross margin.

вЂў Realized and unrealized Both as finance cost.

вЂў Realized and unrealized Both as raw material cost.

2. Finance Cost: Inclusion and exclusion Trade Finance and Bank Charges, Overdraft interest shall form part of finance cost or bank interest, LC Commission shall form part of Raw Material cost or shall be treated as bank charges (may not be relevant to IFRS) just the accounting treatment.

3. Revaluation of Forex assets and liability at period closing, eg cash backed LC, how to treat this…

Suppose I have an external commercial borrowing(India) of 100M USD for 10 years, with conversion rate of 1USD= 50INR.

Now I hedge this and I have a 10M debtor every year.

If in future the exchange rate becomes 1USD=60INR, how would my liability be impacted and what would be the balancing accounting.

On my books in INR, I will have a 6000INR loan, but how would I balance this?

Dear Chirag Jain,

if you do it right, then you would have a corresponding derivative asset amounting to approximately 1000INR in your accounts. 에스.

I have a question. If my entity has a functional currency of EUR and it has foreign currency transactions in GBP, when I go and prepare the accounts in a GBP presentation currency, do I apply a period end rate to my original GBP transactions or just use the original GBP amounts?

Dear Richard, please apologize for the later response. Let me split it:

- Monetary assets/liabilities: At the year-end, you translate it from GBP to EUR, you use closing rate, isn’t it? Then when you translate it back to GBP (as to presentation currency), you use the same rate and you should be fine.

- Non-monetary assets/liabilities: At the year-end, you do not translate them, but you keep them in a historical rate. However, after you recognized the asset initially, it stopped being GBP asset and became EUR asset (it’s non-monetary). So yes, apply closing rate.

- Transactions in P/L: you should apply the transaction date rates, so you should be OK.

Hope this helps! 에스.

Hi, Silvia. I have a question about translating statements from functional currency to presentation. Is the resulting difference in OCI is just an item (line) which balances other items of statement of financial position with each other? Or there should be some postings in the accounting books? It`s a little bit confusing, because if we have operations in different currencies other than functional and we report in the functional currency, the exchange difference goes to P/L.

But I think the first variant is right.

Yes, Katrine, the first variant is right. Translating FS to presentation currency is NOT a bookkeeping operation – it’s just a presentation. 에스.

감사! It helped a lot)

Hi, Silvia. I`m wondering is there any situations when IAS 21 may not be applied. Particularly I`m interested in the preparation of statements in the reporting currency other than functional. I`m working in the company that prepares statements for its Holding, using the closing rate for all items, including retained earnings, so there is no need of including differences in OCI. But Holding is the European company and works according to the IFRS requirement. My colleagues don`t know. You are my only hope.

well, as soon as a company or a holding applies IFRS, then it must apply ALL IFRS standards, including IAS 21. There is no exception. So, if your financial statements will be a part of holding’s consolidated financial statements under IFRS, then yes, you need to apply IAS 21. S.

I have seen one IFRS interoperatation Committe for Revenue Recognition when the Sales Contact is in Foreign Currency (Foreign currency translation of Revenue)

Foreign currency translation of revenue: views 5.

Revenue is recognised using the spot rate at the date:

вЂў an enforceable contract is entered into (T0): View A.

вЂ“ rights and obligations of transaction established at this date.

вЂў advance payment is received (ie on recognition of deferred.

revenue) (T1): View B.

вЂ“ first recognition of transaction is when either of parties to contract first.

вЂў the revenue is recognised (T2): View C.

вЂ“ if payment is in advance, the difference between the deferred revenue.

balance and amount of revenue due to fx movements is recognised.

as an exchange gain/loss as revenue is recognised.

вЂ“ delivering services/goods is viewed as a transaction in its own right.

You have any idea about finalisation of above issue .

Advance Payment Received.

Which Exchnage rate we should use for entering Sales & Purchases ?

your clarification is highly useful.

More on this topic.

Honestly speaking it is difficult to understand the topic. suppose the following is the case.

Contract signed Jnaury.

Advance Payment Received (30%) February.

Goods Supplied. 할 수있다.

Remaining amount Received (70%) July.

Hi Albi, no, this issue has not been completed yet. And, it’s so complex, that it’s difficult to respond within 1 comment, but I can write an article with a case study in the future. 에스.

thank you in advance for that Article. That would be a great research.

If feasible, please consider Payments to Supplier also.

Contract in Foreign Currency (Sales& Purchase)

Contract signed with Client Janaury.

Contract signed with Suppplier Janaury.

Advance Payment Received from Client (30%) February.

Advance Payment to Supplier (70%)-March.

Goods Supplied - May.

Remaining amount to Supplier (30%)-May.

Remaining amount Received from Client (70%) July.

Many accountants & Auditors are confused about the proper treatment. If we use spot rate for recording all the transactions, There would be misleading result. If exchanges rate goes up during the period, better to delay the receipt from Clients if rates decreases then huge loss.

I am from the Philippines. My client has a foreign currency bank account. At year end, I translated the balance using the closing rate for Financial reporting purposes. How do I account for the foreign currency gain/loss? Is it “unrelealized” or “realized”? 고맙습니다.

it’s realized, i. e. you recognize the gain or loss via profit or loss account. 에스.

Is there any possibility of an unrealized gain portion for cash?

I really like your explanations on IFRS but i also need clarifications IAS 21 (Foreign currency translation) on tax administration that collects in different currencies and now during reporting what would be the treatment of the opening balances, period collections, treatment of the loss/gain on translation and closing balances presentation.

please, you need to describe the transaction more precisely. When tax is paid in your local currency on foreign currency items, then the translation depends also on the tax rules, not only on IFRS. But in general – all these payments are translated either via real rate recalculated by your bank, or by the spot rate, as they represent the translation from foreign currency to your functional currency. Opening tax liabilities in foreign currency are translated by the closing rate (of previous rep. period). Gains/losses are reported in profit or loss. 에스.

i have a issue regarding loan revaluation. can you tell me which rate is use for revaluation of loan?? i. e. buying rate or selling rate. this revaluation is not for a bank or any financial institution.

Thanks for IFRS Box , has always been helpful, please if I have taken a loan denominated in foreign currency and at each reporting date , I convert to my functional currency at the closing rate at that period , will the exchange loss or gain go to OCI or P&L.

P/L, because it’s a monetary item. 에스.

I am not yet due to pay back the loan , is the exchange rate realized or unrealized . Also is there any situation I can treat the exchange loss through OCI.

Dear Silvia , In case the company decides to change the prtesenatation currency during the year, then how to translate comparative figures. Also wrt current year figures-is the procedure same as for change in functional currency.

IAS 21 does not say anything about the change of presentation currency, but it is appropriate to follow the rules for change in accounting policy under IAS 8 (unless it is not practical), i. e. retrospective application.

I have one question as follow.

Our subsidiary is based in Mozambique where the exchange rate was about 30 at 31/12/2014 and 44.49 at 31/12/2015 and around 78 at this moment. However, the official inflation rate of this country is relative low (about 15% in 2016) and will not be over 100% for the last 3 years.

Can we consider Mozambique a hyperinflationary economy? If not, what can we do to ensure the comparability of prior period information.

Thank you in advance for your help,

Sorry, I would like to add further information.

This question is for the consolidation purpose. The parent company is reporting in USD while the subsidiary is reporting in MZN (Mozambique local currency).

well, the criterion about the official rate being over or coming close to 100% for 3 years is not decisive. There are more factors to consider whether the economy is or is not hyperinflationary – 예 : how do people keep their wealth – in foreign currency? In local currency? Or, are interest rates, salaries and prices anyhow linked to a price index? etc. For more guidance, please look to IAS 29.3.

Then, if there are no such indicators, and you conclude that an economy is not hyperinflationary, you just don’t apply IAS 29. S.

would you please clarify the deference between the translation in subsequent report in How to report transactions in Functional Currency paragraph and How to translate financial statements into a Presentation Currency paragraph as the non monetary items well translated at historical cost initially then we well translated them at closing rate when we translate financial statements?

Also Silva need advice regards the risks that may arise if we replaced volatile functional currency with one of major currency like $( specially in.

Hyperinflationary economy environment )

Hi Hisham, if you don’ translate all your financial statements into some other (presentation) currency, then you do nothing with your non-monetary asset. If you do translate your financial statements to the other currency, then you use closing rate for all assets including non-monetary. I think I explained it in the paragraph Functional vs. Presentation currency.

Hi there Silvia, I would like to obtain a clarification with regards to the term “Settlement” as used in IAS 21.

In paragraph 15 of IAS 21, it is stated as follows :

“An entity may have a monetary item that is receivable from or payable to a foreign operation. An item for which settlement is neither planned nor likely to occur in the foreseeable future is, in substance, a part of the entityвЂ™s net investment in that foreign operation, and is accounted for in accordance with paragraphs 32 and 33.”

Does SETTLEMENT of the intercompany balance refer only to payment, as in, cash payments ? Or let’s say, to settle a loan payable to its parent, a subsidiary issues shares to the parent. In substance, would the issue of shares be considered as a form of settlement ?

My interpretation of this is : since the liability of the subsidiary towards the parent no longer exists because of the issue of shares, this is in substance, a settlement of the loan.

Please tell me if I’m right here.

미리 감사드립니다.

Yes, Rishi, I agree. Settlement is a broader term, not limited only to a payment or cash (that would be “cash settlement”).

Thanks for the reply Silvia.

In consolidate foreign operation to presentation currency, IAS 21 states that the results and financial position of foreign operation shall be translated using:

- Assets, liability: closing rate.

- PL: average rate.

However, I don’t know the mentioned fx rate at closing date is the Fx rate used to FX revaluation of foreign operation or parent company at reporting date?

Due to parent company has cash in foreign operation’s currency, it will revaluation foreign cash at reporting date using closing rate. I wonder if using the closing rate of foreign operation to translate to presentation country leads to different applied closing rate in consolidation FS.

And the average rate will get from foreign operation or parent’s transaction?

Hope to see your answer, thanks!

My company is located in Nigeria and functional currency is Naira. our transaction included foreign currency as well as we are involved in Port Logistic services under Oil and gas sector. Every month we run exchange routing to align our current assets and Liability with closing rate.

Now my boss has ask me Balance sheet in USD currency as of end 31st Oct. if I convert all the assets and Liability with closing rate of Oct, then my assets will drastically reduced in term of USD currency compare to last year. the last year rate was 197.5/USD where as of Oct closing rate is Naira 315/USD.

Should I convert with closing rate assets or I should use historical rate.

I should use closing rate only for Current assets and current liability. For assets I should use historical rate?

if I use historical rate only for assets then I am generating difference around 153Mil USD which I have to show under share capital to make the tally Asses-Liability=share capital.

it depends on whether you want to follow IFRS or not. If yes, then technically speaking, you will be translating your financial statements to another presentation currency and in such a case, you need to use the closing rate (in this case, you don’t care about monetary/non-monetary items and historical rates).

Unfortunately, Naira weakened a lot and you could show very high “CTD” or currency translation difference in your equity to balance assets with liabilities.

Dear Silvia, one question regarding PPE traslation.

(I am in Argentina, our funcional currency is PESOS, but the presentation currency (in order to send montly package to Vienna) is USD.

1) In 2006 we bought a warehouse. The cost was 1.055.00 USD. The fx rate at that moment was 3,07. Therefore It equeals to 3.238.850 PESOS.

2)Then, at the end of each month, I have to do the “periodic valuation”. Considerig it is a non monetary item and we measure according historical cost, I have to transalte those 1.055.000 usd to the “historic rate” (3,07). Therefore, by the end of the month the amount in PEOS is the same.

3) Transaltion into presentation currency:

IAS 21 says that all assets have to be translate using the closing rate, BUT in this case this asset is nominate in USD (it was a result of a foreing transaction). So in this case I do not have to transalte from PESOS to USD right? The amount in USD to report in package will allwasy be 1.055.00 USD?

Thanks in advance!!

unfortunately not. PPE is a non-monetary asset and once it sits in your account, you stop thinking of it as about “USD” 유산. So no, the amount on your fixed assets will not be 1055 USD, but 3 238 850 pesos translated with the closing rate. 에스.

Hello I’m in Lebanon and I’m not able to purchase the IFRS kit why? Why my country not on the list.

I think PayPal does not work in Lebanon, that’s why your country is not on the list. For this reason, you can make a payment with the alternative payment gate, directly with the credit card here: sites. fastspring/ifrsbox/product/ifrs-kit-offer.

If you need my further help, just let me know. Kind regards, S.

Hi Sylvia, Revenue was recognised in year 2014 in VEF which has steeply declined up till 2016, subsequently invoice was also cancelled and reissued with revised rates in 2016. Should revenue be also reversed in 2016 and re-recognised at a revised rate or it should be adjusted through retained earnings? Could you please quote relevant para of IFRS addressing the issue? Thanks a lot in advance.

the good question here is why the invoice was cancelled and reissued – was is just due to the change in the VEF?

If it relates to the correction of the revenue itself, then yes, it would be appropriate to correct the retained earnings (it’s a correction of error in the past, please see IAS 8).

If it relates only to the change in VEF and adjusting the receivable in VEF to reflect the change, but it has nothing to do with the past revenue, then I would simply recognized changes in P/L. The reason is that it’s a current-year transaction, something like “revising a receivable and passing the loss to a client”. 에스.

Dear Silvia, Thanks a lot for your reply to Allan. Really appreciated. What I would like to ask further is that I have seen a lot of leading companies declaring revenue results post and pre Foreign Exchange Gain/Loss. If I go by your approach then why do they absorb the foreign exchange impact in the revenue line. To be more specifc US Dollar appreciated in Q1 2015 and leading companies such as Genral Motors, Coca Cola etc. put out their result showing a pre & post Fx impact. We thank you once again for a continuous support you provide to readers all across the world. Kindly keep up the good work.

In Allan’s case, it was one specific case and from the question it was implied that the revenue was adjusted by the difference in foreign exchange – maybe this was the agreement with the client. In some other agreements, it’s the supplier who bears the currency risk. As you see, it all depends.

However, you need to understand how these leading companies sell. Do they sell in USD? Or do they sell in foreign currency – other than their presentation currency?

Also, may I kindly point you to their notes to the financial statements? I am pretty sure that there’s an explanation for that. 에스.

I am a bit confused about journalizing foreign currency transactions, let say a sale of goods in foreign currency on account.

The standard says that you translate it to functional currency by applying the spot exchange rate. The receivable is denominated in foreign currency while it is journalized in the functional currency. If it is not flagged as a receivable in foreign currency then you cannot keep keep track of the change in value do to the change of the foreign currency exchange rate. How do you specify that in the general journal? Thanks a lot in advance.

usually, as far as I know, these foreign currency items are recognized in 2 currencies in the accounting system – both functional and foreign. Of course, you see only the balance in the functional currency when looking to the general ledger, but the information should be somewhere in the system. 에스.

Kindly help me in regard to below query:

Treatment of FX rate variation on imported material: Kindly note that we import material e. g. from US and have SAP system in our company.

At the time of Goods Receipt system (i. e. SAP) Debit the inventory with exchange rate at the time of receipt of material and pass the entry.

Matetrial Account ——Debit (With FX rate at the time of Goods Receipt)

To GR/IR Clearing Account.

On receipt of Invoice from Vendor system pass the entry.

GR/IR Account———–Debit (With FX rate at the time of GR)

Price Rate Difference—Debit (With FX rate variation between GR and Date of Invoice Receipt)

To Vendor Account (FX Rate at the time of Invice Receipt)

My query is whether the price rate difference mentioned above should charge on the Material or directly charged in Profit & Loss Account?

the question is what the transaction date is. In my opinion it is the date when you accepted inventories, not the invoice. Therefore, the price difference should be recognized in profit or loss. You can read more about it here. The article is about the prepayments in foreign currency, but it explain quite clearly what the transaction date is and it helps you understand the issue. 에스.

Please consider below situation -

X Ltd is registered in Georgia (Europe) and is engaged in power business. Power is sold 20% in local georgian market and 80% in Turkey. All sales proceeds are converted in USD on receipt of revenue. The providers of capital i. e. Term loans and equity provides funds in USD.

The functional currency decided by management is Lari (Georgian Currency). Now at every end of period, outstanding loan is being revalued and the exchange difference (USD-lari) is charged to Profit & Loss Account. This exchange loss is a non-cash item because this notional loss will never impact the profitability of the company, as the loans are denominated in USD and loan liability will remain in USD.

In this situation, can Company route such exchange loss on revaluation of loans through other comprehensive income instead of hitting P&L statement.

Hi Mohit, no, I’m sorry. I understand your concerns, but if your functional currency is Lari, then you need to re-calculate and recognize the difference via P/L. 에스.

I work for an NPO and would like to know the treatment of exchange rate differences of funds received from donors. At the budgeting stage we use the spot rate and these budgets can be for a period of 3years and the funds received in tranches. Please advise, thank you.

we are closing year Dec 16.

we have loan from 3 bank around $ 200Mil for running operation activity. we get interest invoice every month from the bank, we recognise as expenses. kindly advise as per IFRS how to treat the actual interest cost in P&L.

Please advise about non-monetary items like advance to supplier, if I have banke letter of gurantee from supplier against advanced payment, curreny revaluation for his balance as advance is correct or not?

for advances, see above. It depends on what type of advance it is. If it’s for goods or services and you don’t assume to get the cash back, then non-monetary. 에스.

Please advise in case of devaluation of currency(i. e.:Egypt) of foreign entity do we still continue to translate foreign operation like we normally do (i. e.: balance sheet items at closing and income statement at average) or there is any other method to translate.

미리 감사드립니다.

devaluation itself is not a reason for different reporting. The only exception is when your economy is hyperinflationary – in this case, there are different requirements to present comparatives, etc. – there’s a specific IFRS standard for it, plus look above to the article. 에스.

Find your article and comments to be very useful.

My query is regarding identifying of functional currency of an entity having manufacturing facilities in one country (say – India) more of domestic raw materials (partly imports too), local labor and other expenses locally, but exporting all their products to another country (say US)- the sales being designated in the currency of the foreign country to whom exports are made (in USD)and settlements also being made in this currency (USD). A portion of the earnings maybe retained in USD balances (but in an Indian bank) from time to time – essentially based on import needs if any. The pre - IFRS practise was to traslate the USD transactions into Indian Rupee. Confused about whether USD or INR will be the functional currency in this case? Indian Rupee has to be continued as the presentation currency.

Hello Silvia M. I read all your post and convince to go for IFRS KIT. but I have few queries, It would be great if you can contact me on my or give me your ID?

당신의 응답을 기다리는.

Hi Gaurav, please try resending the message to supportifrsbox.

Amazing building of concepts through you!

I feel some confusion while accounting for the purchase of machinery for e. g from a foreign country, so if total cost is 100,000$ and terms of payment includes downpayment as an advance to supplier and 4 instalments. then how to account for this, and do the previous payments already made if talking about 3 payment, to be brought to latest forex rate and difference computed as exchange gain finally become part of the asset?

Dear Silvia Mam,

Can you please make it clear to me whether any foreign exchange differences (loss) arising out of import of capital goods bought for the start of operation of its business on its pre - operation stage can be booked or capitalized assuming it to be a pre-operating cost itself??

No, you don’t capitalize any forex gain/loss. Also, you do NOT capitalize the pre-operating costs under IFRS (unless they specifically relate to the acquisition of an item of PPE or intangible asset or other eligible asset).

We are an Online Travel Agent and acting like an agent according to; ifrsbox/ifrs-revenue-principal-agent/

Our revenue is the commission on trips (no package deals created by our company), price is determined by the actual operator.

I assume we have the focus on non-monetary customer prepayments and operator prepayments, both in foreign currencies (other than reporting currency EUR). We are allowed to recognize revenue once there is no cancellation option for the customer any more.

How to deal with the received prepayments and payments made to the final operators?

Example: (note: company has USD and EUR bank account)

Day 01 вЂ“ customer prepayment 1.000 USD вЂ“ fx to EUR = 1:1.

Day 10 вЂ“ prepayment by us to Operator 3.000 THB вЂ“ fx to EUR= 1:30.

Day 20 вЂ“ prepayment by us to Operator 20.000 THB вЂ“ fx to EUR= 1:25.

Day 30 вЂ“ cancellation date, on date of Revenue recognition:

According to IFRIC 22 (effective 01-01-2018) you should take the fx on the actual вЂњtransaction dateвЂќ. By this, it means that we will have the following result to be determined on Day 30:

Revenue customer part: 1.000 / 1 = EUR 1.000.

Revenue operator part: вЂ“ 3.000 / 30 = вЂ“ EUR 100.

Revenue operator part: вЂ“ 20.000 / 25 = вЂ“ EUR 800.

Total revenue result in the P&L to be taken / shown: EUR 100,-

No FX result should be shown in the report, based on IFRIC 22.

Is that the right conclusion? Or do you have a different opinion on this? Thanks for your support.

We are in the process of implementing Dynamics 365 and I have a question concerning Forex /PPV accounting under IFRS.

If we have our standard costs in GBP say Good A 80 GBP and we have raised a PO for 100 EUR (as it is a foreign supplier). Exchange rate at Std cost import is 0.8.

At receipt of the goods (before we receive the invoice) is 0.79.

Our postings would be: (in GBP)

Dr Inventory 80 (since we are standard costing)

Cr GRNI 79 (since в‚¬100 now equals ВЈ79 at the fx rate at receipt.

Cr ? 1 (being forex difference)

Is the Cr PPV or FX difference (bearing in mind that I think that the GRNI/PO is a non monetary item)?

미리 감사드립니다.

We are a gas distribution company and buy gas from various exploration companies. Monthly Dollar invoices are received for gas procured. We pay in Rupees.

To avoid exchange rate complications, we have entered into an agreement with the exploration comapnies such that we maintain/lock a mutually agreed exchange rate for 6 months. We therefore book our liability and make payment on such rate since its known to us.

Is IFRS 21 applicable in this scenario?

What rate should foreign currency payables/ receivables be converted at? Is it the Buying rate or Selling Rate.

If the company changed the functional currency, should we translate the comparative FS as well?

Question about the proper treatment of a construction work in progress (WIP) statement. For my question, assume that the project is being managed in a local currency different from the reporting currency.

I assume that the original contract would be valued at the contract’s inception date.

Now the project has a contract change order. I am assuming that I value the change based on its inception date.

Now the revised contract (original + change orders) would be the original contract (in reporting currency) plus the change order (in reporting currency)

Is this the correct treatment? 미리 감사드립니다!

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IAS plus.

개요.

IAS 21 The Effects of Changes in Foreign Exchange Rates outlines how to account for foreign currency transactions and operations in financial statements, and also how to translate financial statements into a presentation currency. An entity is required to determine a functional currency (for each of its operations if necessary) based on the primary economic environment in which it operates and generally records foreign currency transactions using the spot conversion rate to that functional currency on the date of the transaction.

IAS 21 was reissued in December 2003 and applies to annual periods beginning on or after 1 January 2005.

History of IAS 21.

Related Interpretations.

IFRIC 16 Hedge of a Net Investment in a Foreign Operation IFRIC 22 Foreign Currency Transactions and Advance Consideration SIC-30 Reporting Currency – Translation from Measurement Currency to Presentation Currency . SIC-30 was superseded and incorporated into the 2003 revision of IAS 21. SIC-19 Reporting Currency – Measurement and Presentation of Financial Statements under IAS 21 and IAS 29 . SIC-19 was superseded and incorporated into the 2003 revision of IAS 21. SIC-11 Foreign Exchange – Capitalisation of Losses Resulting from Severe Currency Devaluations . SIC-11 was superseded and incorporated into the 2003 revision of IAS 21. SIC-7 Introduction of the Euro.

Amendments under consideration by the IASB.

Summary of IAS 21.

Objective of IAS 21.

The objective of IAS 21 is to prescribe how to include foreign currency transactions and foreign operations in the financial statements of an entity and how to translate financial statements into a presentation currency. [IAS 21.1] The principal issues are which exchange rate(s) to use and how to report the effects of changes in exchange rates in the financial statements. [IAS 21.2]

Key definitions [IAS 21.8]

Functional currency: the currency of the primary economic environment in which the entity operates. (The term 'functional currency' was used in the 2003 revision of IAS 21 in place of 'measurement currency' but with essentially the same meaning.)

Presentation currency: the currency in which financial statements are presented.

Exchange difference: the difference resulting from translating a given number of units of one currency into another currency at different exchange rates.

Foreign operation: a subsidiary, associate, joint venture, or branch whose activities are based in a country or currency other than that of the reporting entity.

Basic steps for translating foreign currency amounts into the functional currency.

Steps apply to a stand-alone entity, an entity with foreign operations (such as a parent with foreign subsidiaries), or a foreign operation (such as a foreign subsidiary or branch).

1. the reporting entity determines its functional currency.

2. the entity translates all foreign currency items into its functional currency.

3. the entity reports the effects of such translation in accordance with paragraphs 20-37 [reporting foreign currency transactions in the functional currency] and 50 [reporting the tax effects of exchange differences].

Foreign currency transactions.

A foreign currency transaction should be recorded initially at the rate of exchange at the date of the transaction (use of averages is permitted if they are a reasonable approximation of actual). [IAS 21.21-22]

At each subsequent balance sheet date: [IAS 21.23]

foreign currency monetary amounts should be reported using the closing rate non-monetary items carried at historical cost should be reported using the exchange rate at the date of the transaction non-monetary items carried at fair value should be reported at the rate that existed when the fair values were determined.

Exchange differences arising when monetary items are settled or when monetary items are translated at rates different from those at which they were translated when initially recognised or in previous financial statements are reported in profit or loss in the period, with one exception. [IAS 21.28] The exception is that exchange differences arising on monetary items that form part of the reporting entity's net investment in a foreign operation are recognised, in the consolidated financial statements that include the foreign operation, in other comprehensive income; they will be recognised in profit or loss on disposal of the net investment. [IAS 21.32]

As regards a monetary item that forms part of an entity's investment in a foreign operation, the accounting treatment in consolidated financial statements should not be dependent on the currency of the monetary item. [IAS 21.33] Also, the accounting should not depend on which entity within the group conducts a transaction with the foreign operation. [IAS 21.15A] If a gain or loss on a non-monetary item is recognised in other comprehensive income (for example, a property revaluation under IAS 16), any foreign exchange component of that gain or loss is also recognised in other comprehensive income. [IAS 21.30]

Translation from the functional currency to the presentation currency.

The results and financial position of an entity whose functional currency is not the currency of a hyperinflationary economy are translated into a different presentation currency using the following procedures: [IAS 21.39]

assets and liabilities for each balance sheet presented (including comparatives) are translated at the closing rate at the date of that balance sheet. This would include any goodwill arising on the acquisition of a foreign operation and any fair value adjustments to the carrying amounts of assets and liabilities arising on the acquisition of that foreign operation are treated as part of the assets and liabilities of the foreign operation [IAS 21.47]; income and expenses for each income statement (including comparatives) are translated at exchange rates at the dates of the transactions; and all resulting exchange differences are recognised in other comprehensive income.

Special rules apply for translating the results and financial position of an entity whose functional currency is the currency of a hyperinflationary economy into a different presentation currency. [IAS 21.42-43]

Where the foreign entity reports in the currency of a hyperinflationary economy, the financial statements of the foreign entity should be restated as required by IAS 29 Financial Reporting in Hyperinflationary Economies , before translation into the reporting currency. [IAS 21.36]

The requirements of IAS 21 regarding transactions and translation of financial statements should be strictly applied in the changeover of the national currencies of participating Member States of the European Union to the Euro – monetary assets and liabilities should continue to be translated the closing rate, cumulative exchange differences should remain in equity and exchange differences resulting from the translation of liabilities denominated in participating currencies should not be included in the carrying amount of related assets. [SIC-7]

Disposal of a foreign operation.

When a foreign operation is disposed of, the cumulative amount of the exchange differences recognised in other comprehensive income and accumulated in the separate component of equity relating to that foreign operation shall be recognised in profit or loss when the gain or loss on disposal is recognised. [IAS 21.48]

Tax effects of exchange differences.

These must be accounted for using IAS 12 Income Taxes .

Disclosure.

The amount of exchange differences recognised in profit or loss (excluding differences arising on financial instruments measured at fair value through profit or loss in accordance with IAS 39) [IAS 21.52(a)] Net exchange differences recognised in other comprehensive income and accumulated in a separate component of equity, and a reconciliation of the amount of such exchange differences at the beginning and end of the period [IAS 21.52(b)] When the presentation currency is different from the functional currency, disclose that fact together with the functional currency and the reason for using a different presentation currency [IAS 21.53] A change in the functional currency of either the reporting entity or a significant foreign operation and the reason therefor [IAS 21.54]

When an entity presents its financial statements in a currency that is different from its functional currency, it may describe those financial statements as complying with IFRS only if they comply with all the requirements of each applicable Standard (including IAS 21) and each applicable Interpretation. [IAS 21.55]

Convenience translations.

Sometimes, an entity displays its financial statements or other financial information in a currency that is different from either its functional currency or its presentation currency simply by translating all amounts at end-of-period exchange rates. This is sometimes called a convenience translation. A result of making a convenience translation is that the resulting financial information does not comply with all IFRS, particularly IAS 21. In this case, the following disclosures are required: [IAS 21.57]

Clearly identify the information as supplementary information to distinguish it from the information that complies with IFRS Disclose the currency in which the supplementary information is displayed Disclose the entity's functional currency and the method of translation used to determine the supplementary information.

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