摘要：Due to the internationalization of business and frequent fluctuations in exchange rates, information aboutthe impact of changes in exchange rates on individual companies’ and multinational groups’ financialposition and profitability has become increasingly important. Data on the translation effects of both foreigncurrency transactions and foreign subsidiaries’ financial statements, a company’s exposure to different typesof foreign exchange risks and taken currency hedging measures enable many users of accounting contents toobtain a better picture of an entity’s financial position and its profitability. The key issues relate to the choiceof the exchange rate to be used in accounting data translation and the financial reporting presentation oftranslation effects. While the effects of the foreign subsidiaries’ financial statements translation can be shownin the balance sheet and the income statement, the effects of foreign currency transactions translation areincorporated in the income statement. This paper discusses the accounting aspects of the foreign currencytransactions translation, an enterprise’s transactional exposure to a currency risk, and the use of financialderivative instruments to hedge against foreign exchange risk.
