Foreign Currency Translation (IAS 21/AASB 121/IAS 29/AASB 129)

Corporate Reporting Insights

BDO's monthly newsletter, Corporate Reporting Insights, keeps you up to date with the latest Australian and global developments in corporate financial and sustainability reporting.

BDO Global IFRS Resources

The following publications have been produced by the BDO Global IFRS group:

► IFRS at a Glance

A high level overview of International Financial Reporting Standards (IFRSs), including International Accounting Standards and Interpretations.

• IAS 21 The Effects of Changes in Foreign Exchange Rates
• IAS 29 Financial Reporting in Hyperinflationary Economies
• IFRIC 7 Applying the Restatement Approach under IAS 29 Financial Reporting in Hyperinflationary Economies
• IFRIC 16 Hedges of a Net Investment in a Foreign Operation
• IFRIC 22 Foreign Currency Transactions and Advance Consideration​.

► IFR Bulletins

Focus on latest developments in international financial reporting.

• Hyperinflationary economies update - 31 October 2023 (IFRB 2023 10)
• Lack of exchangeability (IFRB 2023 08)
• Hyperinflationary economies update 30 November 2022 (IFRB 2022 08)
• Hyperinflationary economies update at 31 October 2022 (IFRB 2022 06)
• Hyperinflationary economies update – 30 April 2022 (IFRB 2022 03)
• Hyperinflationary economies for the period ended 31 December 2021  (IFRB 2022 02)
• Hyperinflationary economies for 31 December 2020​ (IFRB 2021 02).

Webinars

BDO Australia conducts monthly complimentary webinars as an easy way to stay up to date with changes to accounting standards and other financial reporting developments. Recent webinars on this topic include:

• Foreign exchange complexities (December 2021).

IFRIC agenda decisions

IFRS Interpretations Committee (the Committee) agenda decisions are those issues that the Committee decided not to take onto its agenda. Although not authoritative guidance, in practice they are regarded as being highly persuasive, and all entities reporting under IFRS should be aware of these decisions because they could impact the way particular transactions and balances are accounted for. Agenda decisions on this topic include:

• ​Translation of a hyperinflationary foreign operation - I​AS 21​ (March 2020) and eLearning​ and FAQ
• Cumulative exchange differences before a foreign oper​ation becomes hyperinflationary (March 2020) and eLearning​ and FAQ
• ​Presenting comparative amounts when a foreign operation first becomes hyperinflationary (March 2020) and eLearning​​ and FAQ
• Determination of the exchange rate when there is a long-term lack of exchangeability​ (September 2018) and FAQ
• Foreign exchange restrictions and hyperinflation (November 2014) and FAQ
• Concept of capital financial maintenance defined in terms of constant purchasing power units (January 2014) and FAQ
• Repayments of investments and foreign currency translation reserve (September 2010) and FAQ
• Functional currency of an investment holding company (March 2010) and FAQ
• Translation of assets and liabilities at transition date – transition issues under IFRS 1​ (October 2004) and FAQ​.

Online training resources

Improve your knowledge of accounting standards by purchasing our online training resources on a variety of financial reporting topics. Resources available on this topic include:

• A seminar – a pre-recorded two-hour webinar that provides a high-level overview of the accounting standard, as well as a question and answer case study booklet