Wiley GAAP 2015: Interpretation and Application of Generally Accepted Accounting Principles 2015

Chapter 51ASC 830 FOREIGN CURRENCY MATTERS

PERSPECTIVE AND ISSUES

   Subtopics

   Scope and Scope Exceptions

   Overview

DEFINITIONS OF TERMS

CONCEPTS, RULES, AND EXAMPLES

   Translation of Foreign Currency Financial Statements

   Summary of Current Rate and Remeasurement Methods

   Foreign Operations in the United States

   Translation of Foreign Currency Transactions

   Intercompany Transactions and Elimination of Intercompany Profits

   Foreign Currency Hedging

   Forward Exchange Contracts

   The Fair Value Option

ACCOUNTS TO BE REMEASURED USING HISTORICAL EXCHANGE RATES

PERSPECTIVE AND ISSUES

Subtopics

ASC 830 contains five subtopics:

• ASC 830-10, Overall
• ASC 830-20, Foreign Currency Transactions
• ASC 830-30, Translation of Financial Statements
• ASC 830-250, Statement of Cash Flows
• ASC 830-740, Income Taxes.

ASC 830 provides guidance about

• Foreign transaction and
• Translation of financial statements.

Scope and Scope Exceptions

ASC 830 applies to all entities. ASC 830-20 does not apply to derivative instruments. Preparers should look to ASC 815 for guidance on derivatives.

Overview

To facilitate the proper analysis of foreign operations by financial statement users, transactions and financial statements denominated in foreign currencies must be expressed in a common currency (i.e., US dollars). The GAAP governing the translation of foreign currency financial statements and the accounting for foreign currency transactions are found primarily in Accounting Standards ...