Chapter 16 Flashcards
What does IAS 21 deal with?
Definition of functional and presentation currencies
Accounting for individual transactions in foreign currency
Translating Financial statements of a foreign currency
What are the two main complications of subsidiary that uses different functional currency?
Translation of foreign currency subsidiary into parents currency
Resulting calculation and recognition of foreign currency exchange gains or losses
What rate do you use to convert income and expenses?
Average rate
What rate do you use to convert assets and liabilities?
closing rate
What rate do you use to convert GW of subsidiary?
Closing rate
What rate do you use to convert opening net assets?
Opening rate
What rate do you use to convert TCI?
Average rate
What rate do you use to convert closing net assets?
Closing rate
Where are exchange difference on net assets and goodwill recognised?
Within equity and OCI
What rate do you use to convert GW b/f?
Opening rate
What rate do you use to convert impairment?
Average rate
What rate do you use to convert GW c/f?
closing rate
What are the exchange differences on net assets split between?
Parent and NCI shareholders
Where is the exchange difference on GW accounted?
All to parent if NCI uses proportionate of net assets method
Split between parent and NCI if NCI measured using FV method
Where are the exchange differences on translation of subsidiary recognised?
Within OCI
