The world is becoming more interconnected due to non-stop advances in communication and transportation technologies, facilitating cross-border flows of investment and equity capital.

The concept of foreign direct investment (FDI), which is defined as an investment in the form of a controlling ownership in a business in one country by an entity based in another country, has become a cornerstone in today’s global economic system.

Accordingly, the number of businesses that have operations in multiple countries has increased significantly, and the fair presentation of foreign subsidiaries’ financial statements to the parent entity’s stakeholders is needed.

The hallmark of consolidated foreign subsidiaries is that their financial statements are presented in a different currency from their parent’s presentation currency.

This course explains and illustrates the accounting processes for translating foreign subsidiaries financial statements step-by-step, including consolidation criteria, types of financial statements currencies, the proper accounting treatment for the resulting translation gain/(loss), and the currencies of hyperinflationary economies.

This course uses practical cases and examples that simplify the theory behind US GAAP standard ASC Subtopic 830-30 “Translation of financial statements” and IFRS standard IAS 21 “The Effects of Changes in Foreign Exchange Rates”, highlighting the main differences between them.

Course Key Concepts: GAAP- ASC 830 – foreign Currencies – foreign Subsidiaries – foreign currencies -translation – IFRS - IAS 21 – other comprehensive income (OCI) - hyperinflationary economies – consolidated – consolidation.