accounting exposure

Accounting exposure

The change in the value of a firm's foreign currency-denominated accounts due to a change in exchange rates.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

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.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

accounting exposure

see EXCHANGE RATE EXPOSURE.
Collins Dictionary of Business, 3rd ed. © 2002, 2005 C Pass, B Lowes, A Pendleton, L Chadwick, D O’Reilly and M Afferson
References in periodicals archive ?
January 2018 Lease Accounting Exposure Draft http://bit.ly/2DLHLHd
"That is a pure accounting exposure companies have on operations or business outside of their home country," he said.
"Companies don't want to spend real dollars to hedge what are basically accounting exposures."
(3) Accounting exposure, transaction exposure or strategic/long-term exposure are alternative categories that focus more on the source of exposure.
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.
Translation is governed by accounting conventions and therefore also is referred to as accounting exposure. Translation exposure stems from differences in foreign exchange rates between consolidation dates and the effects of these changes on the valuation of a company's assets and liabilities abroad.
Strategic foreign currency management differs from traditional accounting exposures because strategic foreign currency management becomes an integral part of a business's operations and requires the combined efforts of operating and financial functions to identify currency risks and opportunities.
For the hedging of accounting exposures, foreign currency debt and currency forwards represent the most popular risk management instruments.
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.