Accounting for foreign currency: 5 things you need to know

Need a refresher on accounting for foreign currency translations and transactions? In this week’s episode, Heather Horn and PwC managing director John Horan go back to the basics and examine the accounting for foreign currency, including:3:10 - Identification of foreign entities - John discusses how to identify a company’s foreign entities, including the definition of a foreign entity, the concept of separate and distinct operations and why identification is so important to getting the right accounting.8:29 - Determining the correct functional currency - John discusses the indicators that should be considered when determining the functional currency of foreign entities.13:50 - Routine foreign currency accounting - John discusses foreign currency transactions, remeasurement, and the translation process.18:10 - Releasing CTA - John shares his perspectives and answers common questions on when, and if, CTA should be released. 23:00 - Other complex areas seen in practice - John discusses the concept of loans designated as a permanent advance. He also discusses the steps a company should take if it wants to change the designation.About our guest As a managing director in PwC’s National office, John Horan assists clients with complex accounting issues in the areas of foreign currency, liabilities and equity, earnings per share and derivatives and hedging. John specializes in large capital transactions and initial public offerings. About our host Heather Horn is PwC’s National office thought leader, responsible for developing our communications strategy and conveying firm positions on accounting and financial reporting matters. She is the engaging host of PwC’s accounting and reporting weekly podcast and quarterly webcast series, as well as periodic webcasts for the power and utilities industry. With over 25 years of experience, Heather’s accounting and auditing expertise includes financial instruments and rate-regulated accounting.

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