Foreign currency

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Accounting guide , PwC US

Accounting for foreign currency transactions? Download our updated guide.

This guide was partially updated in June 2019.

PwC’s updated accounting and financial reporting guide, Foreign currency, addresses the accounting for foreign currency transactions and foreign operations under US GAAP. The guide discusses the framework for accounting for foreign currency matters and their related accounting implications, and includes specific examples related to various topics such as:

  • Functional currency determinations

  • Translation of financial statements of foreign entities

  • Highly inflationary economies

  • Intercompany transactions denominated in foreign currencies

  • Acquisitions and dispositions of foreign operations


The accounting guidance on foreign currency matters was written more than 30 years ago; yet this topic remains particularly relevant in today’s global economy. Since the accounting literature was originally issued, many companies have changed their operating structures, expanded internationally, and often transact business in multiple global currencies. Although accounting for foreign currency matters has always been a challenging area, globalization has led to increased complexities with respect to the application of this guidance.

This guide begins with a summary of the overall framework for accounting for foreign currency matters. The ensuing chapters further discuss each step in the framework, including identifying foreign entities, determining functional currencies, accounting for foreign currency transactions, and translating financial statements of foreign entities. This guide also discusses accounting implications related to highly inflationary economies, intercompany transactions denominated in foreign currencies, and acquisitions and dispositions of foreign operations.

Each chapter highlights key aspects of the guidance and includes specific questions and examples to illustrate its application, particularly in today’s modern economy. Relevant references to and excerpts from the FASB’s Accounting Standards Codification are interspersed throughout the guide. Guidance on financial statement presentation and disclosure, foreign currency-related hedging activities, and income tax accounting can be found in other PwC guides.

We take you back to the basics on accounting for foreign currency. Here are 5 things you need to know.

Downloading the guide onto an iPad

  1. Click on the button below to open document:
    Foreign currency
  2. Once the PDF opens, click on the Action button, which appears as a square icon with an upwards pointing arrow.
  3. From within the action menu, select the "Copy to iBooks" option.
  4. The guide will then be saved to your iBooks app for future access.

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John Bishop

John Bishop

Partner, National Professional Services Group, PwC US

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