IAS 21 Presentation Joseph Kariuki KPMG
GLOBAL AUDIT LEARNING AND DEVELOPMENT
IAS 21 – The Effects of Changes in Foreign
Exchange Rates
AUDIT
© [year] [legal member firm name], a [jurisdiction] [legal structure] and a member firm of the KPMG network of independent member firms affiliated with
KPMG International, a Swiss cooperative. All rights reserved. Printed in [country in which the publication will be printed].
FOR INTERNAL USE ONLY
1
Learning objectives
♦ Describe the definitions as per IAS 21
♦ Examine and Assess how foreign currency transactions and balances are translated into a company’s functional currency
♦ Examine and Assess how foreign currency financial statements are translated for consolidation purposes
♦ Discuss disclosure requirements for the notes to financial statements
© [year] [legal member firm name], a [jurisdiction] [legal structure] and a member firm of the KPMG network of independent member firms affiliated with
KPMG International, a Swiss cooperative. All rights reserved. Printed in [country in which the publication will be printed].
FOR INTERNAL USE ONLY
2
Agenda
♦ Definitions
♦ Foreign currency transactions
♦ Foreign currency financial statements
♦ Hyperinflationary economy
♦ Disclosure
© [year] [legal member firm name], a [jurisdiction] [legal structure] and a member firm of the KPMG network of independent member firms affiliated with
KPMG International, a Swiss cooperative. All rights reserved. Printed in [country in which the publication will be printed].
FOR INTERNAL USE ONLY
3
IAS 21 definitions
Functional currency
The currency of the primary economic environment in which the entity operates
Foreign currency
A currency other than the functional currency of an entity
Presentation currency
The currency in which the financial statements are presented
© [year] [legal member firm name], a [jurisdiction] [legal structure] and a member firm of the KPMG network of independent member firms affiliated with
KPMG International, a Swiss cooperative. All rights
IAS 21 – The Effects of Changes in Foreign
Exchange Rates
AUDIT
© [year] [legal member firm name], a [jurisdiction] [legal structure] and a member firm of the KPMG network of independent member firms affiliated with
KPMG International, a Swiss cooperative. All rights reserved. Printed in [country in which the publication will be printed].
FOR INTERNAL USE ONLY
1
Learning objectives
♦ Describe the definitions as per IAS 21
♦ Examine and Assess how foreign currency transactions and balances are translated into a company’s functional currency
♦ Examine and Assess how foreign currency financial statements are translated for consolidation purposes
♦ Discuss disclosure requirements for the notes to financial statements
© [year] [legal member firm name], a [jurisdiction] [legal structure] and a member firm of the KPMG network of independent member firms affiliated with
KPMG International, a Swiss cooperative. All rights reserved. Printed in [country in which the publication will be printed].
FOR INTERNAL USE ONLY
2
Agenda
♦ Definitions
♦ Foreign currency transactions
♦ Foreign currency financial statements
♦ Hyperinflationary economy
♦ Disclosure
© [year] [legal member firm name], a [jurisdiction] [legal structure] and a member firm of the KPMG network of independent member firms affiliated with
KPMG International, a Swiss cooperative. All rights reserved. Printed in [country in which the publication will be printed].
FOR INTERNAL USE ONLY
3
IAS 21 definitions
Functional currency
The currency of the primary economic environment in which the entity operates
Foreign currency
A currency other than the functional currency of an entity
Presentation currency
The currency in which the financial statements are presented
© [year] [legal member firm name], a [jurisdiction] [legal structure] and a member firm of the KPMG network of independent member firms affiliated with
KPMG International, a Swiss cooperative. All rights