Abstract
The structure and the constituent parts of financial statements are regulated at a national level, mainly by Accounting regulations compliant with European Directives ̶ O.M.P.F. no. 3055/2009, but also by Accounting regulations compliant with International Financial Reporting Standards applied by the trading companies whose securities are rated on a regulated capital market ̶ O.M.P.F. no. 1286/2012. From this latter point of view, an important role is played by IAS 1 “Presentation of Financial Statements”, respectively IAS 21 “The Effects of Changes in Foreign Exchange Rates”. Therefore, this study aims to describe a series of theoretical and practical aspects regarding the particularities of presenting elements generated by foreign currency transactions in financial statements, which are prepared in compliance with the Romanian accounting regulations ̶ balance sheet, profit and loss account, cash flow statement, statement of changes in equity, explanatory notes. The paper also approaches the effect of changes in foreign exchange rates, respectively the accounting recognition of exchange differences, which are specific to different foreign currency operations, according to national regulations (and implicitly, to European Directives), but also according to international regulations (IFRS).
Highlights
The purpose of financial statements, including those prepared and published by entities which deploy economic operations of foreign trade, consists of the following considerations regarding the synthetic documents:
The main particularity which characterises the entities that perform international economic transactions consists in recording in accountancy the expressed operations, quantified in another type of currency from the national one, a particularity which presents a series of difficulties which may consist in: determining the exchange rate used in the conversion/translation of foreign currency into the national one, the manner of recording in accountancy and of presenting the effects of changes in the foreign exchange rate in financial statements, changes which arise in different stages of the accounting cycle etc
The balance sheet reflects the financial position of the entity on the basis of its assets, of equities and debts, as well as on the basis of assets and debts resulted from foreign currency transactions
Summary
The purpose of financial statements, including those prepared and published by entities which deploy economic operations of foreign trade, consists of the following considerations regarding the synthetic documents:.
Sign-in/Register to view highlights & summary Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callMore From: STUDIES AND SCIENTIFIC RESEARCHES. ECONOMICS EDITION
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
