tarunajwani

I'm thinking Northeastern Student is correct (Option B)?

From reading the question the local currency i.e. not the dollar has appriciated over the year. We want to convert from local currency --> USD / local currency (not stated) --> presentational currency (USD).

Assuming the local currency appriciates against the dollar this would create a positive CTA. Leading on from this there is a higher level of shareholders equity, which in turn would lead to a decrease in ROE (as NI doesn't change as much)

Or it could be that I'm completely wrong and I should go to bed!

(Hmmm, fourth edit, definitely time for bed)



Edited 4 time(s). Last edit at Tuesday, May 25, 2010 at 07:44PM by Smiffy.