Programme Objective

An entity may carry on foreign activities in two ways. It may have transactions in foreign currencies, or it may have foreign operations. In addition, an entity may present its financial statements in a foreign currency. 

The objective of this seminar is to prescribe how to include foreign currency transactions and foreign operations in the financial statements of an entity and how to translate financial statements into a presentation currency.

The principal issues that will be addressed in this seminar are which exchange rates to use and how to report the effects of changes in exchange rates in the financial statements. 

These issues will be tackled in the form of practical case studies which participants and the lecturer will undertake together.
 

Programme Outline

• Factors to be considered in determining a company’s functional currency
• Accounting for foreign currency issues
  • accounting for transactions and balances in foreign currencies i.e. a currency other than the functional currency of the entity
  • in translating foreign operations for consolidation
  • in translating an entity’s results into a presentation currency i.e. the currency in which the financial statements are presented
• Case study 1        
  • Translation of a foreign subsidiary’s financial statements to facilitate consolidation
• Case study 2 
  • Accounting for changes of a functional currency
• Case study 3        
  • Re-measurement of the financial statements of an entity that did not keep the financial statements in the correct functional currency.
• Case study 4        
  • Accounting for monetary items that represent the net investment in a foreign subsidiary
• Case study 5        
  • Accounting for the net investment in a foreign subsidiary where the monetary item is not in the functional currency of either the parent or the foreign operation
• Case study 6
  • Presentation of exchange differences in the statement of cash flows

NOTE: Participants are required to bring along their calculators for the seminar.

Training Methodology

Lecture style, with illustrative examples, scenario analysis and hands-on exercises. 

Closing Date for Registration

1 week before programme or until full enrolment.

Intended For

Accountants who wish to have a more detailed understanding of accounting for foreign exchange transactions and for auditors who have to verify the appropriateness of the valuation and disclosure of assets in the financial statements.

Programme Facilitator(s)