This was posted before but I believe it was misquoted. NI/Equity for current rate. NI is avg rate, but the equity is translated at?? I thought before someone said equity is current because A-L=E, and AC uses current for the BS items. The answer to this question was noted to be equity is translated at historical rate. Can someone clarify??
just reading this now…Equity is translated at historical rate in either AC or Temporal.
Historical CTA balances A - L = E + CTA
Equity is always translated at the historical rate. Equity is exposed with the AC method because assets and liabilities are translated using hte current rate - any losses that occur will come out of equity/CTA
where are you guys reading this? My readings say equity is mixed under Temporal method, current rate under All Current method. Whoever is saying historical is wrong, they most likely are referring to Common Stock, which is in fact historical under both methods. Current: NI is average, Equity is current. Temporal: NI is Mixed as you have revenue at average rate, nonmonetary assets at current…and Equity is mixed because of this and retained earnings.
Common Stock at Historical Equity at Current : Equity includes Common Stock and Retained Earnings
Current rate method: Equity as a whole (incl. the CTA adjustment) would be translated at the Current Rate. Assets are at Current Rate, Liabilities are at Current Rate. So A - L = E (as a whole) should be Current Rate. NI is average rate under Current Rate method. Individual components of Equity: Common Stock: Historic Retained Earnings: Plug. Dividends: Historic (as of date of payment).
tvPM Wrote: ------------------------------------------------------- > where are you guys reading this? > My readings say equity is mixed under Temporal > method, current rate under All Current method. > > Whoever is saying historical is wrong, they most > likely are referring to Common Stock, which is in > fact historical under both methods. > > Current: NI is average, Equity is current. > Temporal: NI is Mixed as you have revenue at > average rate, nonmonetary assets at current…and > Equity is mixed because of this and retained > earnings. Ah, yes - sorry, I was referring to only common stock.