Foreign Currency Translation is the process of expressing amounts denominated in one currency in terms of another currency using the exchange rate between the currencies. Assets and liabilities are translated at the current exchange rate as of the balance sheet date, while income statement items are typically translated at the weighted-average exchange rate for the period.
A method of translating foreign currency transactions by utilizing the exchange rate on the transaction date. Generally used for items not classified as foreign currency monetary items or those not measured at fair value.
