IAS21_06 - IAS 21 International Accounting Standard 21 The...

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IAS 21 © IASCF 1147 International Accounting Standard 21 The Effects of Changes in Foreign Exchange Rates This version includes amendments resulting from Amendment to IAS 21 The Effects of Changes in Foreign Exchange Rates— Net Investment in a Foreign Operation issued on 15 December 2005.
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IAS 21 1148 © IASCF C ONTENTS paragraphs INTRODUCTION IN1–IN17 INTERNATIONAL ACCOUNTING STANDARD 21 THE EFFECTS OF CHANGES IN FOREIGN EXCHANGE RATES OBJECTIVE 1–2 SCOPE 3–7 DEFINITIONS 8–16 Elaboration on the definitions 9–16 Functional currency 9–14 Net investment in a foreign operation 15–15A Monetary items 16 SUMMARY OF THE APPROACH REQUIRED BY THIS STANDARD 17–19 REPORTING FOREIGN CURRENCY TRANSACTIONS IN THE FUNCTIONAL CURRENCY 20–37 Initial recognition 20–22 Reporting at subsequent balance sheet dates 23–26 Recognition of exchange differences 27–34 Change in functional currency 35–37 USE OF A PRESENTATION CURRENCY OTHER THAN THE FUNCTIONAL CURRENCY 38–49 Translation to the presentation currency 38–43 Translation of a foreign operation 44–47 Disposal of a foreign operation 48–49 TAX EFFECTS OF ALL EXCHANGE DIFFERENCES 50 DISCLOSURE 51–57 EFFECTIVE DATE AND TRANSITION 58–60 WITHDRAWAL OF OTHER PRONOUNCEMENTS 61–62 APPENDIX Amendments to other pronouncements APPROVAL OF IAS 21 BY THE BOARD APPROVAL OF AMENDMENT TO IAS 21 BY THE BOARD BASIS FOR CONCLUSIONS
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IAS 21 © IASCF 1149 International Accounting Standard 21 The Effects of Changes in Foreign Exchange Rates (IAS 21) is set out in paragraphs 1–62 and the Appendix. All the paragraphs have equal authority but retain the IASC format of the Standard when it was adopted by the IASB. IAS 21 should be read in the context of its objective and the Basis for Conclusions, the Preface to International Financial Reporting Standards and the Framework for the Preparation and Presentation of Financial Statements . IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors provides a basis for selecting and applying accounting policies in the absence of explicit guidance.
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IAS 21 1150 © IASCF Introduction IN1 International Accounting Standard 21 The Effects of Changes in Foreign Exchange Rates (IAS 21) replaces IAS 21 The Effects of Changes in Foreign Exchange Rates (revised in 1993), and should be applied for annual periods beginning on or after 1 January 2005. Earlier application is encouraged. The Standard also replaces the following Interpretations: •S I C - 1 1 Foreign Exchange—Capitalisation of Losses Resulting from Severe Currency Devaluations I C - 1 9 Reporting Currency—Measurement and Presentation of Financial Statements under IAS 21 and IAS 29 I C - 3 0 Reporting Currency—Translation from Measurement Currency to Presentation Currency . Reasons for revising IAS 21 IN2 The International Accounting Standards Board developed this revised IAS 21 as part of its project on Improvements to International Accounting Standards.
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This note was uploaded on 06/12/2011 for the course ECON 801 taught by Professor Brend during the Summer '11 term at Abu Dhabi University.

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IAS21_06 - IAS 21 International Accounting Standard 21 The...

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