Please provide references that can be cited.
Are there any provisions of IAS or US GAAP or any acceptable accounting standards for mutiple functional currencies to be used in the preparation of financial statements. The provisions for separate o
Answers
Here's an interesting article (with reference to FAS 52) to cite:
http://www.eisneramper.com/Foreign-Currency-Translation-FAS-52.aspx
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Many thanks for your response. The article however, does not address the question directly. I was hoping for a reference to a part of a standard that either allows for multiple functional currencies for a single entity (a part for separate
Regards
US GAAP for consolidated financial statements requires reporting in a single currency, and specifies functional currency identification for individual components, as well as rules to translate other currencies into the reporting currency. The individual units can use individual functional or local currencies to record activity, but consolidated financial reporting must reflect the reporting currency of the reporting entity via translation.
I was going to let this one go because Barrett Peterson provides the correct answer to the main issue of currencies and reporting, while Wayne Spivak's reference to FAS 52 details the actual requirements. But, I have a question (or two...).
What problem are you attempting to solve? Do you have a single corporate entity that is bound by foreign vendor or customer agreements that are driven by their currencies? Does this single entity have employees in foreign offices? Or is this a consolidation question, which has been addressed by Mr. Peterson? How would the answer affect your reporting? Are you trying to deal with translation of long-lived assets and depreciation?
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