标题: NI effect from re measurement [打印本页] 作者: mamuka12 时间: 2011-7-13 13:06 标题: NI effect from re measurement
With changes in the Krona (reporting currency is US$), compared to using the current rate method, the NT under temporal method will most likely be: higher? lower?
Year-end: $0.14 = 1 Krona
Average: $0.132 = 1 Krona
The subsidiary is running in Net monetary liabilities.
My answer: The Krona is appreciating, so @ historical rate (suppose the E.R is $0.13 = 1 Krona) would make the depreciation under temporal lower, NI is higher
The Schweser answer: Since the Krona is appreciating and the company is running net monetary libabilities, the remeasurement loss occurs, which makes NI is lower
The Schweser answer seems fair for me. But am I wrong in my answer?
