U.S. GAAP Codification of Accounting Standards

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U.S. GAAP Accounting Standards
Codification Topic 830: Foreign Currency Matters


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Codification Topic 830
Foreign Currency Matters


Foreign Currency Transactions and Translation
SFAS 52, December 1981
"Foreign Currency Translation"

Functional currency
1. Functional currency
--> the currency of the primary economic environment
--> of the entity

2. Accounting transactions are measured and recorded in functional currency

Reporting currency
Reporting currency
--> the currency used to report financial statements

Translation
If reporting currency is not functional currency
--> all items reported in financial statements are
--> translated from functional currency to reporting currency

Remeasurement
1. If accounting transactions are recorded in local currency that is not functional currency
--> remeasure accounting records from local currency to functional currency
--> then translate from functional currency to reporting currency
2. Accounting records after remeasurement 
--> will be same as (1)
(1) accounting records when all transactions were recorded in functional currency

Exchange rate for remeasurement
1. For nonmonetary accounts
--> use historical rates between local currency and functional currency
2. For revenue and expenses resulted from nonmonetary accounts
--> use historical rates between local currency and functional currency
3. For monetary accounts
--> use current rate between local currency and functional currency
4. Foreign currency transaction gains and losses are also recognized

Foreign currency transaction gains and losses are
--> recognized in income
--> with some exceptions
--> as explained in the Codification Topic 830-20

Foreign currency translation adjustments are
--> reported in other comprehensive income (OCI)
--> as explained in the Codification Topic 830-30

Changes in functional currency
When functional currency changes
--> previous financial statements are not restated



International Financial Reporting Standards (IFRS)

   IAS 21: The effects of changes in foreign exchange rates


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   Codification Topic 830
   Foreign Currency Matters
 
Subtopics of Codification Topic 830
 
   830-10 Overall
   830-20 Foreign currency transactions
   830-30 Translation of financial statements
 
Accounting Terms of Codification Topic 830-10
 
   Attribute
   Exchange rate
   Foreign currency
   Foreign currency statements
   Foreign currency transactions
   Foreign currency translation
   Foreign entity
   Functional currency
   Local currency
   Reporting currency
   Reporting entity
   Special drawing rights
   Translation
   Translation adjustments
   Unit of measure
 
Accounting Terms of Codification Topic 830-20
 
   Transaction date
   Transaction gain or loss
 
Accounting Terms of Codification Topic 830-30
 
   Conversion
   Noncontrolling interest



   Other Topics at the Codification 800 
Accounting Standards Codification, ASC, Overview
 
ASC Codification Topic 805: Business Combinations
ASC Codification Topic 808: Collaborative Arrangements
 
ASC Codification Topic 810: Consolidation
ASC Codification Topic 815: Derivatives and Hedging
 
ASC Codification Topic 820: Fair Value Measurements and Disclosures
ASC Codification Topic 825: Financial Instruments
 
ASC Codification Topic 830: Foreign Currency Matters
ASC Codification Topic 835: Interest
 
ASC Codification Topic 840: Leases
ASC Codification Topic 845: Nonmonetary Transactions
 
ASC Codification Topic 850: Related Party Disclosures
ASC Codification Topic 852: Reorganizations
ASC Codification Topic 855: Subsequent Events
 
ASC Codification Topic 860: Transfers and Servicing


   U.S. GAAP Codification of Accounting Standards
Accounting Standards Codification, ASC, Overview
ASC Codification 200: Presentation
ASC Codification 300: Assets
ASC Codification 400: Liabilities
ASC Codification 500: Equity
ASC Codification 600: Revenue
ASC Codification 700: Expenses
ASC Codification 800: Broad Transactions
ASC Codification 900: Industry

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