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ADVANCED ACCOUNTING 2010 Week 21

2. FOREIGN OPERATIONS. STUDY OBJECTIVES:1.NEED FOR TRANSLATION2.NOTION OF FUNCTIONAL CURRENCY3.TRANSLATION PRINCIPLES AND PROCEDURE4.NET INVESTMENT IN A FOREIGN OPERATION5.DISPOSAL OF A FOREIGN OPERATION6.CHANGE OF FUNCTIONAL CURRENCY7.TRANSLATION WHERE SAME FUNCTIONAL CURRENCY ???8.THE PRESENTATION CURRENCY9.DISCLOSURE ISSUES.

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ADVANCED ACCOUNTING 2010 Week 21

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    1. ADVANCED ACCOUNTING 2010 Week 21 FOREIGN OPERATIONS IAS 21

    2. 2 FOREIGN OPERATIONS STUDY OBJECTIVES: 1. NEED FOR TRANSLATION 2. NOTION OF FUNCTIONAL CURRENCY 3. TRANSLATION PRINCIPLES AND PROCEDURE 4. NET INVESTMENT IN A FOREIGN OPERATION 5. DISPOSAL OF A FOREIGN OPERATION 6. CHANGE OF FUNCTIONAL CURRENCY 7. TRANSLATION WHERE SAME FUNCTIONAL CURRENCY ??? 8. THE PRESENTATION CURRENCY 9. DISCLOSURE ISSUES

    3. 3 1. NEED FOR TRANSLATION 1.1 An entity may be involved in foreign currency in 2 ways: It may have foreign currency transactions (buy / sell goods / services & borrow / lend funds which are foreign currency-denominated It may have a foreign operation (foreign subsidiary, JV, associate or branch 1.2 IAS 21 (deals with both) Forex transactions Foreign operations (completed already) (this lecture week)

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