translation loss

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Translation Loss

The loss that occurs when one exchanges one floating currency for another and then trades back into the first currency after it has become stronger. For example, suppose a person has 1,000,000 U.S. dollars and exchanges them for 500,000 British pounds; this means the exchange rate is two dollars per pound. Later, if that person still has those 500,000 pounds when the dollar has risen (quite dramatically) to one dollar per pound and exchanges them back to dollars, he/she has $500,000 instead of $1 million. In this case, the translation loss is $500,000.

translation loss

The loss that results when a firm translates amounts stated in one currency into terms of another currency. The loss is incurred when the firm translates from a currency that has declined in value relative to the currency into which the amounts are being converted.
References in periodicals archive ?
This resulted in translation losses of R1,2 billion on the valuation of the balance sheet compared to translation losses of R341 million in the prior period.
8M increase in foreign exchange translation losses associated with our euro denominated debt as compared to the same period in 2016.
In its management report, ADCB said second-quarter trading income was impacted by "unrealised FX translation losses, reflective of turbulent markets.
GIG's risk-adjusted capitalisation remains good, despite the company suffering foreign exchange translation losses in Egypt, which drove down capital and surplus by nine per cent to KWD 83 million ($625 million) at year-end 2016.
Bank Audi used a part of the realized exceptional revenues to write off its investments in Syria and Sudan for an amount of $191 million, accounted for under results of discontinued operations, net of tax, of which $136 million of foreign-currency translation losses [are] already accounted for in common equity, which have therefore translated by a similar increase in the Tier 1 capital," the statement said.
The Turkish economy by contrast benefits from low oil prices, but has other economic and political issues that may impact its market -- and therefore the contribution from Abank -- especially when the probability of further foreign exchange translation losses is factored in.
The hit to earnings from currency translation losses has certainly been a factor in multinationals' earnings for well over a year now.
3 percent in foreign exchange translation losses, while acquisition growth added 5.
Despite the preference shares subscribed to by government as part of its official assistance programme for banks and a separate rights issue carried out last year, the lender's Tier 2 capital is burdened by fair value losses on Greek government bonds as well as by foreign exchange translation losses on its investments.
The bank recorded foreign exchange translation losses in the third quarter of $1.
A larger revaluation would be counter productive, as it would impair budgetary balances and current account surpluses, in addition to translation losses on the large pool of dollar denominated assets that oil revenues have created, he argued Additionally a move to a free float would not be advisable at this time as the region lacks a well developed debt market that helps transmit interest rate signals, an important pre-requisite for monetary policy to function effectively in a floating exchange rate regime.
Bryan D'Aguiar, Head of Equity Research of NCB Capital said, "Any move towards a change of the peg to the US Dollar needs to be conducted in a transparent manner, with the components and weights publicly disclosed, in order to avoid speculative pressures"A larger revaluation would be counter-productive, as it would impair budgetary balances and current account surpluses, in addition to translation losses on the large pool of dollar denominated assets that oil revenues have bought into.
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