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Accounting Exposure

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Accounting exposure
The change in the value of a firm's foreign currency-denominated accounts due to a change in exchange rates.

Accounting Exposure
The risk that a company may suffer a reduction in value because a change in exchange rates reduces the value of its accounts or assets denominated in foreign currencies. That is, if a particular currency in which a company has some assets denominated decreases in value, the value of those assets also decreases with respect to the company's main currency. See also: Foreign exchange risk.


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A focus on living benefits that fall under mark-to-market accounting ignores other living benefits, which generate identical economic exposures but different accounting exposures, such as income benefits or withdrawal benefits for life.
Accounting exposure includes all the items on the profit and loss account or balance sheet that are affected by changes in the exchange rate.
Using responses to the ten accounting exposure drafts receiving the highest public responses, the active role of Big Eight (now Big Five) firms is underscored.
 
 
 
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