| Financial Reporting Standard 121 |
Contents
| INTRODUCTION |
paragraphs
IN1-IN17 |
Financial Reporting Standard 121
The Effects of Changes in Foreign Exchange Rates |
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| 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 |
| 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 |
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WITHDRAWAL OF OTHER PRONOUNCEMENTS
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61-62 |
Style
Additions to IFRSs are clearly identified and would be made in a manner that preserves the format and structure of the IFRSs.
If a new paragraph is added, that paragraph would be labelled with the preceding paragraph number followed by a capitalised alphabet and the word "added" is included at the right side of the paragraph. If a paragraph is deleted, the text would be marked as deleted text by the inclusion of the word "deleted" at the right side of the paragraph and the reason for the deletion is explained at the end of the paragraph. [New paragraph or deleted paragraph without the indication of "added" or "deleted" at the right side of the paragraph is amendments made by the IASB.]
Additions or deletions made within the paragraph in IFRSs would be shaded and underlined or struck through respectively. [Those additions and deletions which are underlined or struck through without shading are amendments made by the IASB.]
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Financial Reporting Standard 121 The Effects of Changes in Foreign Exchange Rates (FRS 121) is set out in paragraphs 1-62. All the paragraphs have equal authority. FRS 121 should be read in the context of its objective and the Basis for Conclusions, the Foreword to Financial Reporting Standards and the Proposed Framework for the Preparation and Presentation of Financial Statements. FRS 108 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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