foreign currency translation

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Foreign currency translation

The process of restating foreign currency accounts of subsidiaries into the reporting currency of the parent company in order to prepare consolidated financial statements.

Foreign Currency Translation

When a parent-subsidiary relationship exists between two companies in different countries using different currencies, the act or practice of changing the financial statements of the subsidiary to conform to the accounting standards of the parent's country, as well as re-denominating the subsidiary's currency into the parent's currency. According to the Generally Accepted Accounting Principles in the United States, the translation of a foreign currency to U.S. dollars must be accurate as of the date on the financial statement. If there have been substantial changes to the exchange rate since that date, the consolidated financial statement must note this.

foreign currency translation

foreign currency translation

the process of denoting the assets and liabilities of a MULTINATIONAL ENTERPRISE'S foreign subsidiary's BALANCE SHEET and the revenues and expenses of the subsidiary's PROFIT-AND-LOSS ACCOUNT, which are expressed in terms of the subsidiary's local currency by translating them into the parent company's domestic currency. This is done in order to prepare CONSOLIDATED ACCOUNTS for the group.

There are two main currency translation methods:

  1. the closing rate, or net investment method, or all-current method, in which all foreign currency items are translated at the EXCHANGE RATE ruling at the date of the balance sheet. With the closing rate method any gains or losses on exchange arising from translation are taken direct to the group balance sheet an dealt with as changes in RESERVES so as not to affect reported PROFIT.
  2. temporal method or current/non-current method, in which fixed assets and long-term liabilities are translated at the exchange rate ruling at the date of their acquisition, and revenues and expenses at an average exchange rate for the year. With the temporal method any differences arising on translation are taken to the profit-and-loss account where they serve to affect recorded profit.
References in periodicals archive ?
Revenue excluding acquisitions and foreign currency translations (organic revenue) is a non-GAAP measure; the accompanying financial tables contain a reconciliation to consolidated revenue.
In CGTU051, MCII Announces Additional Shareholder Investment of $50 Million, Reports First Quarter Earnings, moved earlier today, we are advised by a representative of the company that in the tabular material, the line items Foreign Currency Translations Gain (Loss), Other Income (expense) and Income Taxes (benefit) should read:
The restatement of the Statement of Cash Flows will include a reclassification of $110,141 cash flows from finance receivables under the heading "Cash Flows From Investing Activities" to the heading "Cash Flows From Operating Activities" and possible adjustment of certain amounts reflecting the effect of foreign currency translations on cash.
Other factors which could cause such results to differ materially from those described in the forward-looking statements include delays in developing, completing, or shipping new or enhanced products, the ability to assimilate acquisitions into MSC's operations, foreign currency translations, and other risks and uncertainties that are detailed in the Company's annual report on Form 10-K and other reports filed by the Company with the Securities and Exchange Commission.
Other factors that could cause such results to differ materially from those described in the forward-looking statements include delays in developing, completing, or shipping new or enhanced products, the ability to assimilate acquisitions into MSC's operations, foreign currency translations, and other risks and uncertainties that are detailed in the Company's annual report on Form 10-K and other reports filed by the Company with the Securities and Exchange Commission.
This press release contains forward-looking statements that involve uncertainties, including, but not limited to, risks and uncertainties related to foreign currency translations, the competitive environment and other risks.
Factors which could cause such results to differ materially from those described in the forward-looking statements include delays in developing, completing, or shipping new or enhanced products, fluctuation in quarterly results, foreign currency translations, and other risks and uncertainties that are detailed in the Company's annual report on Form 10-K and other reports filed by the Company with the Securities and Exchange Commission.
Factors that could cause results to differ materially from those described in the forward-looking statements include delays in developing, completing, or shipping new or enhanced products, the ability to assimilate UAI's operations into MSC's operations, foreign currency translations, and other risks and uncertainties that are detailed in the company's annual report on Form 10-K and other reports filed by the company with the Securities and Exchange Commission.
These include possible delays in developing, completing, or shipping new or enhanced products, the ability to integrate the Engineering-e Division, the ability to develop parallel distribution channels, worldwide economic conditions, foreign currency translations, competition and other risks and uncertainties that are detailed from time to time in the Company's SEC reports, including the most recent Form 10-K and Form 10-Q reports.

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