Translation of functional currency into presentational currency in FINREP

Background provided by the submitter · verbatim

FINREP reporting instructions do not provide any explicit recommendations regarding the exchange rate to be utilised for conversion from the functional currency into the presentational currency. As a result, different practices can be observed among the entities, including: using the exchange rate in effect as of the balance sheet date, the average exchange rate for the reporting period, the official ECB rate at the end of the reporting period, etc. In our opinion, this is particularly relevant for the entities whose functional currency is that of a hyperinflationary economy, when the translation into presentational currency is strongly affected by rapid movements in the exchange rate between them.

Rationale for rejection · verbatim

This question has been rejected because the issue it deals with is already addressed in National GAAP developed under Directive 2013/34/EU or IAS/IFRS developed under Regulation (EC) No 1606/2002, where applicable.

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