Discuss CIMA CIMAPRA19-F02-1 Exam Topic 1 Question 17

Which TWO of the following are true in relation to IAS21 The Effects of Changes in Foreign Exchange Rates when consolidating an overseas subsidiary?

AAcurrent period exchange gain or loss is shown within the consolidated statement of comprehensive income within other comprehensive income.

BGoodwill is re-translated at the end of each reporting period and reflected at the period end exchange rate in the consolidated statement of financial position.

CAssets and liabilities of the subsidiary are translated at each reporting date using the average exchange rate for the period.

DGoodwill is reflected in the consolidated statement of financial position translated at the exchange rate on the date of acquisition.

EThe statement of profit or loss of the subsidiary is translated for the reporting period using the closing exchange rate.

Suggested Answer: A, B

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14 comments · newest first

Sherell 11 months ago

B is spot on, goodwill is always at the period end rate!

Lawana 11 months ago

E is misleading, it should be the average rate for the period!

Gene 12 months ago

Wait, is it really true that goodwill isn't re-translated?

Glendora 12 months ago

I agree, D is correct about goodwill at acquisition rate!

Chu 12 months ago

A is definitely not true, gains/losses go to profit or loss.

Cherry 1 year ago

I recall that the statement of profit or loss should be translated using the average rate, not the closing rate, so E seems off to me.

King 1 year ago

I practiced a similar question where assets and liabilities were translated at the closing rate, so I feel like D is definitely one of the answers.

Emerson 1 year ago

I'm not entirely sure about B; I thought goodwill was only re-translated at acquisition, but I could be mixing it up with another standard.

Veronika 1 year ago

I think option A might be correct because I remember something about exchange gains or losses being included in other comprehensive income.

Flo 1 year ago

This looks like a pretty straightforward question. I'd focus on analyzing the key metrics like annual recurring revenue, renewal rates, and timeliness of bill pay to get a sense of the overall health of the account.

Regenia 1 year ago

Changing the time zone? That doesn't seem right. I'm going to go with installing a new program.

Rosalyn 1 year ago

Okay, this looks like a straightforward question about the functionality of cloud moderation. I'll need to carefully read through the options and select the 3 that best match the goals Ursa Major Solar can accomplish.

Gearldine 1 year ago

The 'l' argument should do the trick. That's the one I'm going with.

Gracie 1 year ago

Alright, time to put my networking skills to the test. I think the key here is to identify the specific protocol or feature that's needed for SSM on that interface. Gotta eliminate the distractors.

CIMAPRA19-F02-1 Exam - Topic 1 Question 17 Discussion