continue the discussion with the views of Kayitare and Yankurije. I prefer them to give us points with clear example.short
translation of the balance sheet of the subsidiary into the currency of the parent
by HITAYEZU Innocent -
Number of replies: 4
In reply to HITAYEZU Innocent
Re: translation of the balance sheet of the subsidiary into the currency of the parent
by DIANE NAMAHORO -
Foreign currency translation is used to convert the results of a parent company's foreign subsidiaries to its reporting currency. This is a key part of the financial statement consolidation process. The steps in this translation process are as follows: Determine the functional currency of the foreign entity.
In reply to HITAYEZU Innocent
Re: translation of the balance sheet of the subsidiary into the currency of the parent
By using example ,Armadillo Industries has a subsidiary in Australia, to which it ships its body armor products for sale to local police forces. The Australian subsidiary sells these products and then remits payments back to corporate headquarters. Armadillo should consider U.S. dollars to be the functional currency of this subsidiary.
Armadillo also owns a subsidiary in Russia, which manufactures its own body armor for local consumption, accumulates cash reserves, and borrows funds locally. This subsidiary rarely remits funds back to the parent company. In this case, the functional currency should be the Russian ruble.
Armadillo also owns a subsidiary in Russia, which manufactures its own body armor for local consumption, accumulates cash reserves, and borrows funds locally. This subsidiary rarely remits funds back to the parent company. In this case, the functional currency should be the Russian ruble.
In reply to HITAYEZU Innocent
Re: translation of the balance sheet of the subsidiary into the currency of the parent
by ROSINE NIYONKURU -
Foreign currency translation is used to convert the results of a parent company's foreign subsidiaries to its reporting currency. This is a key part of the financial statement consolidation process. The steps in this translation process are as follows:
Determine the functional currency of the foreign entity.
Remeasure the financial statements of the foreign entity into the reporting currency of the parent company.
Record gains and losses on the translation of currencies.
Determine the functional currency of the foreign entity.
Remeasure the financial statements of the foreign entity into the reporting currency of the parent company.
Record gains and losses on the translation of currencies.
In reply to HITAYEZU Innocent
Re: translation of the balance sheet of the subsidiary into the currency of the parent
by ELISA BYIRINGIRO -
The balance sheet of the branch operation can now be translated into a dollars reporting currency of parent company using the current ate methad the foreign currency translate is used to convert the result of a parent company s foreign subsidiaries to it's reporting currency translation of financial statement