1 An overview of FX Exposure Risk: Assessment and Management
2 June 2015
3 1. Introduction This report presents an overview of various types of foreign currency exposure, their impact on the financial statements, and management. Foreign currency exposure is a financial risk posed by an exposure to unanticipated changes in the exchange rate between two currencies. Foreign Exchange risk arises when a company holds assets or liabilities in foreign currencies and affects the earnings and capital of the entity due to the undesired and unanticipated fluctuations in the exchange rates. Foreign currency exposure is equal to the variance between the functional (or measurement or domestic) currency and the foreign currency. Types of FX Exposure: The term exposure refers to the extent to which a firm is affected by exchange rate changes. Exposure determines the potential magnitude of the risks that accompany currency fluctuations. A distinction is commonly drawn between accounting exposure, which refers to the changes in financial statements that occur due to currency changes, and economic exposure, which refers to real economic changes. Accounting exposure may or may not have economic consequences. Economic exposure, in turn, is commonly divided into two categories: Operating exposure is the economic exposure created when the operations of a firm generate foreigncurrency-denominated cash flows. Transaction exposure is the economic exposure created when contractual obligations are denominated in foreign currencies. The primary difference between operating and transaction exposure is that with transaction exposure the amount of the currency flows is known in advance. For this reason, the methods firms may use to manage each type of exposure will differ. The table below illustrates in a snapshot the different types of exposures across time and their implications: Transaction or Contractual Exposure Outstanding obligations Translation or Accounting Exposure Economic or Operating Exposure Accounting statements Future cash flows Time e Point in time when Exchange Rate incident occurs
4 2. Translation Exposure Translation or Accounting Exposure is the sensitivity of the real domestic currency value of Net Assets (Assets minus Liabilities) appearing in the financial statements to unanticipated changes in exchange rates. Thus, translation exposure affects the balance sheet and the income statement. According to IAS 21, the results and financial position of an entity 1 are translated into a different presentation currency using the following procedures: i. Assets and liabilities for each balance sheet presented (including comparatives) are translated at the closing rate at the date of that balance sheet. 2 ii. Income and expenses for each income statement (including comparatives) are translated at exchange rates at the dates of the transactions; and iii. All resulting exchange differences are recognized in other comprehensive income 3. Item Rate How to present Differences Assets (including goodwill) and liabilities Income and expenses Share capital Closing rate Historical rate (average) Not specified in IAS In Other Comprehensive income (OCI) as a separate component of Equity Example 1.1 An entity commenced business on January 1, 2013, with an opening share capital of $2 million. The income statement and closing balance sheet follow: Income Statement for the year ended December 31, 2013 (in million USD) Revenue 32 Cost of sales (10) Gross profit 22 Distribution costs (8) Administrative expenses (2) Profit before tax 12 Tax expense (4) Profit for period 8 1 Under the condition that the functional currency is not the currency of a hyperinflationary economy. 2 This would include any goodwill arising on the acquisition of a foreign operation and any fair value adjustments to the carrying amounts of assets and liabilities arising on the acquisition of that foreign operation are treated as part of the assets and liabilities of the foreign operation. 3 According to IAS 1, Other comprehensive income comprises items of income and expense (including reclassification adjustments) that are not recognized in profit or loss as required or permitted by other IFRSs. The components of other comprehensive income include: a) changes in revaluation surplus (see IAS 16 Property, Plant and Equipment and IAS 38 Intangible Assets); b) actuarial gains and losses on defined benefit plans recognized in accordance with paragraph 93A of IAS 19 Employee Benefits; c) gains and losses arising from translating the financial statements of a foreign operation (see IAS 21 The Effects of Changes in Foreign Exchange Rates); d) gains and losses on re-measuring available-for-sale financial assets (see IAS 39 Financial Instruments: Recognition and Measurement); e) the effective portion of gains and losses on hedging instruments in a cash flow hedge (see IAS 39).
5 Balance Sheet as of December 31, 2013 (in million USD) Share capital 2 Retained earnings 8 Equity Trade payables Total equity and liabilities 14 Land (non-depreciable) acquired Dec 31, Inventories 4 Trade receivables 2 Total assets The functional currency is the dollar, but the entity wishes to present its financial statements using the euro as its presentation currency. The entity translates the opening share capital at the closing rate. The exchange rates in the examined period were: $1 = January 1, December 31, Average rate 1.5 In order to translate the financial statements from the functional currency to the presentation one, according to the procedures indicated earlier, we have: Income Statement for the year ended December 31, 2013 (in million EUR) Calculations Revenue 48 =32 x 1.5 Cost of sales (15) =(10) x 1.5 Gross profit 33 Distribution costs (12) =(8) x 1.5 Administrative expenses (3) =(2) x 1.5 Profit before tax 18 Tax expense (6) =(4) x 1.5 Profit for period 12 Balance Sheet as of December 31, 2013 (in million EUR) Calculations Share capital 4 =2 x 2 Retained earnings 12 from income statement above Translation gain (loss) 4 =16 12 (see also below) Equity 20 Trade payables 8 =4 x 2 Total equity and liabilities 28 Land (non-depreciable) acquired Dec 31, =8 x 2 Inventories 8 =4x 2 Trade receivables 4 =2 x2 Total assets 28
6 Calculation of translation gain (loss): If translated into euros, the retained earnings would be 16 million ($8 million x 2 ). As the income statement has been translated using the average rate, the profit is 12 million, creating a difference of 4 million. Note that this exchange difference is shown as component of equity and is not recognized in profit or loss. 3. Transaction Exposure Transaction exposure reflects the impact of settling outstanding obligations entered before into a change in the exchange rate, but settled after the change. Exposure would include all payables and receivables which appear on the balance sheet, as well as off-balance sheet items which represent commitments already entered into, which will create future receivables and payables. Unlike translation gains (losses) which require only a bookkeeping adjustment, transaction gains (losses) are realized as soon as the exchange rate changes. There are four main types of transactions from which contractual exposure arises: Borrowing or lending funds when repayment is to be made in a foreign currency. Purchasing or selling on credit goods or services when prices are stated in foreign currencies. Being a party to an unperformed foreign exchange forward contract. Otherwise acquiring assets or incurring liabilities denominated in foreign currencies. According to IAS 21, a foreign currency transaction should be recorded initially at the rate of exchange at the date of the transaction (use of averages is permitted if they are a reasonable approximation of actual). At each subsequent balance sheet date: Foreign currency monetary 4 amounts should be reported using the closing rate. Non-monetary 5 items carried at historical cost should be reported using the exchange rate at the date of the transaction. Non-monetary items carried at fair value should be reported at the rate that existed when the fair values were determined. Exchange differences arising when monetary items are settled or when monetary items are translated at rates different from those at which were translated when initially recognized or in previous financial statements, are reported in profit or loss in the period. However, exchange differences arising on a monetary item that forms part of a reporting entity s net investment in a foreign operation shall be recognized in profit or loss in the separate financial statements of the reporting entity or the individual financial statements of the foreign operation, as appropriate. In the financial statements that include the foreign operation and the reporting entity (e.g. consolidated financial statements when the foreign operation is a subsidiary), such exchange differences shall be recognized initially in other comprehensive income and reclassified from equity to profit or loss on disposal of the net investment. When a gain or loss on a non-monetary item is recognized in other comprehensive income, any exchange component of that gain or loss shall be recognized in other comprehensive income. Conversely, when a gain or loss on a non-monetary item is recognized in profit or loss, any exchange component of that gain or loss shall be recognized in profit or loss. Other Standards require some gains and losses to be recognized in other comprehensive income. For example, IAS 16 requires some gains and losses arising on a revaluation of property, plant and equipment 4 Monetary items are units of currency held and assets and liabilities to be received or paid in a fixed or determinable number of units of currency. Examples of monetary items are: Trade receivables and payables; Cash dividends recognized as a liability; Investments in debt securities; Deferred taxes; Pension and other employee benefits to be paid in cash; Provisions that are to be settled in cash. 5 Non-monetary items are all items that are not monetary items, i.e. non-monetary items do not have the right to receive or an obligation to deliver a fixed or determinable amount of units of currency. Examples of nonmonetary items are: Prepaid amounts for goods or services; Deferred income; Investments in equity instruments; Inventories and other fixed assets; Goodwill, patents, trademarks and other intangible assets.
7 to be recognized in other comprehensive income. When such an asset is measured in a foreign currency, IAS 21 requires the revalued amount to be translated using the rate at the date the value is determined, resulting in an exchange difference that is also recognized in other comprehensive income. Item Rate How to present Differences Monetary items Closing rate In profit or loss Non-monetary items with the exception of: Historical rate at historical cost Net investment in the foreign operation Non-monetary items Rate at the date when fair value at fair value was measured P&L OCI Example 2.1 ABC Corp. has its headquarters in USA and has a 100%-owned subsidiary in EU; ABC Europe. The functional currency of the subsidiary is the euro and the currency of the parent is US dollars. In Y-E 2013, the subsidiary s balance sheet was: Balance Sheet as of December 31, 2013 (in ) Cash 1,600,000 Accounts payable 800,000 Accounts receivable 3,200,000 S-T bank loan 1,600,000 Inventories 2,400,000 L-T debt 1,600,000 Net plant and equipment 4,800,000 Common stock 1,600,000 Retained earnings 6,200,000 Total 12,000,000 Total 12,000,000 Moreover, we have the following info: Inventories on hand were purchased during the immediately prior quarter when the average exchange rate was 1= $ Net plant and equipment were acquired at a past rate of 1= $ The exchange rate was 1= $1.2 on December 31, If the exchange rate drops by 16.67% to 1= $1, the gains (losses) will be: Assets In Euros Item Exchange rate ($/ ) In US Dollars Cash $1,600,000 Monetary $1,920,000 Accounts receivable 3,200,000 Monetary ,840,000 Inventories 2,400,000 Nonmonetary Not Exposed Net plant and equipment 4,800,000 Nonmonetary Not Exposed Total exposed assets (A) $5,760,000 Liabilities Accounts payable $800,000 Monetary $960,000 S-T bank loan 1,600,000 Monetary ,920,000 L-T debt 1,600,000 Monetary ,920,000 Total exposed liabilities (L) $4,800,000 Net exposed assets (A) - (L) $960,000 (x) Amount of currency depreciation (from 1.2 $/ to 1.0 $/ ) % Exchange gains (losses) -$160,000
8 The loss of $160,000 will be presented in the income statement affecting the net income. Example 2.2: Currency transaction that is settled during the same accounting period XYZ Limited, whose functional currency is, buys raw materials invoiced at $10,000 on January 1, This is a credit transaction. Exchange rate is: 1= $1.47. XYZ Limited records this transaction as follows: Dr. Purchases 6,803 Cr. Creditors 6,803 To record transaction for US $10,000 at exchange rate of 1 = $1.47. Now suppose that the entity pays to the creditors $10,000 on March 1, Exchange rate is: 1= $1.52. Dr. Creditors 6,803 Cr. Bank 6,579 Cr. Exchange gain 224 To record payment of US $10,000 at exchange rate 1 = $1.52. Exchange gain/loss is credited/charged to profit or loss. Example 2.3: Mark to market valuation of outstanding monetary item on the reporting date XYZ Limited, whose functional currency is, buys raw materials invoiced at $10,000 on April 1, This is a credit transaction. Exchange rate is: 1= $1.58. XYZ Limited records this transaction as follows: Dr. Purchases 6,329 Cr. Creditors 6,329 To record transaction for US $10,000 at exchange rate of 1 = $1.58. Now suppose that the entity did not settle the creditors of $10,000 on June 30, 2013, which is the second quarter reporting date. At June 30, 2013, the exchange rate is 1= $1.52. XYZ Limited has to value the amount due to the creditors, which is a monetary item, by applying the closing exchange rate of the reporting date. Dr. Exchange fluctuation loss 250 (= 6,579-6,329) Cr. Creditors 250 We derive the creditor new exposure at $10,000/1.52 = 6,579. To record exchange rate fluctuation on June 30, 2013: ($10,000/1.58) = 6,329 Exchange fluctuation gain/loss is credited/charged to profit or loss.
9 Management of economic- transaction exposure Transaction exposure is an economic exposure due to contractual obligations denominated in a foreign currency. When the contract produces foreign currency inflow, the company is said to be long in the currency. When the contract requires a foreign currency outflow, the company is said to be short in the currency. Managing transaction exposure is the process of generating currency inflows and outflows that moderate the long or short position a company faces in foreign currency. The term hedging in this context typically refers to actions that eliminate the exposure entirely. The simplest tools for hedging involve the use of forward markets and money markets. There are a number of other mechanisms that vary in cost and effectiveness. One important point is that large multinational firms may be in better positions to hedge against exposure and do so at a lower cost since they have control over many cash flows denominated in many currencies. 4. Economic Exposure Economic or Operating Exposure is the sensitivity of a company s future cash flows, foreign investments, and earnings to unanticipated changes in exchange rates and is long-term in nature. Economic exposure encompasses the immediate and potential impact of unexpected exchange rates changes on the cash flow generated and consequently, on the earning power of the company as a whole beyond the accounting period when these changes occurred. Operating exposure occurs as a result of foreign-currency-denominated operations. These operations can take many forms and the consequences of such exposure are dramatic. A foreign operation that is a complete subsidiary (manufacturing, purchasing, and selling in the foreign country) will create exposure only for the amount of future profits. For a company that manufactures domestically but sells overseas, the whole revenue stream is exposed. Conversely, for a company with foreign production but domestic sales, the whole cost stream is exposed. Interestingly, even a firm whose operations are entirely domestic will have operating exposure to the extent that its domestic competitors have foreign-currency-denominated operations. Economic Exposure Strategic Exposure Competitive Exposure In theory, economic exposure can arise only from unexpected changes in exchange rates. Expected changes would be factored in by the financial markets and would be reflected in inflation and interest rate differentials between the country of the parent company and the country of the affiliates in accordance with the Purchasing Power Parity (PPP) and the International Fisher Effect. If financial markets are not efficient to permit these adjustments to be made, the impact of expected exchange rate changes would have been already reflected in the expected cash flows generated by the affiliates and on the market value of the parent company. Example 3.1 ABC Corp. has its headquarters in USA and has a 100%-owned subsidiary in EU; ABC Europe. Economic risk arises from the unexpected change in the value of euro, which is the currency of economic consequence for the European subsidiary. An unexpected depreciation or appreciation in the value of the euro alters both the competitiveness of the subsidiary and the financial results which are consolidated with the parent company. For ABC Europe we have the following information: It uses European material and labor; All sales are invoiced in euros and the average collection period is 90 days;
10 Inventory is equal to 25% of annual direct costs; Depreciation on plant and equipment is 600,000 per year. Plant and equipment, common stock and long-term debt were acquired at a past rate of 1= $1,276; Corporate income tax is equal to 34%; ABC Europe can expand or contract production volume without any significant change in per-unit direct costs or in overall general and administrative expenses; The cost of capital is 20%. We assume that exchange rate was 1= $1.2 on December 31, 2013 and on January 1, 2014 it drops to 1= $1. Three cases are examined: 1. Case 1: no change in costs, prices, sales volume; 2. Case 2: increase in sales volume only; 3. Case 3: increase in sales price only. Balance Sheet as of December 31, 2013 (in ) Cash 1,600,000 Accounts payable 800,000 Accounts receivable 3,200,000 S-T bank loan 1,600,000 Inventories 2,400,000 L-T debt 1,600,000 Net plant and equipment 4,800,000 Common stock 1,600,000 Retained earnings 6,200,000 Total 12,000,000 Total 12,000,000 Assumptions Base case Case 1 Case 2 Case 3 Exchange rate, $/ Sales volume (units) 1,000,000 1,000,000 2,000,000 1,000,000 Sales price per unit Direct cost per unit Annual cash flows before adjustments Sales revenue 12,800,000 12,800,000 25,600,000 15,360,000 Direct cost of goods sold 9,600,000 9,600,000 19,200,000 9,600,000 Cash operating expenses (fixed) 890, , , ,000 Depreciation 600, , , ,000 Pretax profit 1,710,000 1,710,000 4,910,000 4,270,000 Income tax expense 581, ,400 1,669,400 1,451,800 Profit after tax 1,128,600 1,128,600 3,240,600 2,818,200 + Depreciation 600, , , ,000 Cash flow from operations (in ) 1,728,600 1,728,600 3,840,600 3,418,200 Cash flow from operations (in $) $2,074,320 $1,728,600 $3,840,600 $3,418,200 Adjustments to working capital for 2014 and 2018 caused by changes in conditions Accounts receivable 3,200,000 3,200,000 6,400, ,840,000 7 Inventory 2,400,000 2,400,000 4,800, ,400,000 8 Total 5,600,000 5,600,000 11,200,000 6,240,000 6 Double sales volume requires double investment in accounts receivable and in inventory. 7 The increase in sales price per unit leads to increased investment in accounts receivable. 8 The investment in inventory remains the same since annual direct costs do not change.
11 Change from base conditions in 2014 ( ) 0 5,600, ,000 Change from base conditions in 2014 ($) $0 $5,600,000 $640,000 Year Year-End cash-flows 2014 $2,074,320 $1,728,600 -$1,759,400 9 $2,778, $2,074,320 $1,728,600 $3,840,600 $3,418, $2,074,320 $1,728,600 $3,840,600 $3,418, $2,074,320 $1,728,600 $3,840,600 $3,418, $2,074,320 $1,728,600 $9,440, $4,058, Year Change in Year-End cash-flows from Base conditions $345,720 -$3,833,720 $703, $345,720 $1,766,280 $1,343, $345,720 $1,766,280 $1,343, $345,720 $1,766,280 $1,343, $345,720 $7,366,280 $1,983,880 Present Value of incremental Year-End cash-flows -$1,033, $2,866, $3,742, Management of economic- operating exposure One can use forward markets and money markets to partially hedge operating exposure, but the cost of this may be exorbitant. Most often, a company employs strategic decisions regarding revenues (pricing and marketing) and costs (production and input decisions) to manage operating exposure. No method can be completely effective, but the extent of operating exposure in many countries requires that all possible actions be taken and that every alternative be explored, including: Revenue management: A company must often select the market to which it offers a product or service. This means a company can choose a country or market segment within a country. Managing operating exposure can be accomplished by careful market selection. For example, a company can export to a stable country or sell to a market within a country that is not very price-sensitive. In the latter case, the company can pass on any costs from price movements to its customers. When currency movements occur that negatively impact a firm s overseas sales, a company must choose between a loss of market share (keep the domestic value of sales the same by raising the foreign price) or loss of profit margin (keep the foreign price the same but lower the domestic value of sales). This is a choice that has important long-run implications for future cash flows. Conversely, when currencies move in the favor of an exporter, the exporter must choose between profit skimming (higher domestic margins) or market penetration (lower foreign price). Promotional decisions should be made in light of expected or realized currency movements and, therefore, can complement market share decisions. Finally, like choosing a country or market within a country, a firm may simply decide what products to produce or sell in the first place and how many product lines to produce or sell within a given product category. 9 Cash flow from operations Change from base conditions = $3,840,000 $5,600,000 = -$1,759, Cash flow from operations Change from base conditions = $3,418,200 $640,000 = $2,778, At the end of 2018, the cash outflows for working capital should be recaptured.
12 Cost management: The major tools for managing costs in light of currency movements are to adjust input sources (a shortterm decision) and to decide on facility locations (a long-term decision). Adjusting inputs is simply a matter of choosing to source inputs where they are cheaper. One can easily trace the movement of companies from one country to another as they manufacture where labor is relatively cheapest. The same logic applies to most inputs. Another possibility is to raise productivity when difficulties arise. While it might seem that this should always be done, the decision can be complicated. Increasing efficiency is costly. The cost may become small relative to the gains from efficiency only when currencies move so as to create difficulties. Locating plants, and making the related decision of selecting their number and size, should be done in such a way that a firm can adjust to currency movements. Whereas a very large plant might be less efficient, for example, smaller plants in a number of locations might allow better management of currency exposure. Financial management: Financing costs are another input to the production decision over which a firm may have control. Thus, a company may choose to finance its operations in the country it expects to generate revenues since the inflows from sales can be used to pay the financing costs. Of course, financial cash flows are typically contracted whereas operating cash flows may be highly variable. Furthermore, a firm may not always be able to borrow in a local currency. Nevertheless, financial cash flows can certainly be used to some extent to offset local currency exposure. 5. Concluding remarks Accounting or Translation exposure reflects the changes in the dollar value of balance sheet items resulting from fluctuations in the exchange rates of currencies. Transaction exposure reflects the impact of settling all outstanding obligations (including off balance-sheet receivables and payables) at a different exchange rate from the rate prevailing when these obligations were made. The simplest tools for hedging involve the use of forward markets and money markets. Operating exposure is economic exposure that occurs because the firm has foreign currencydenominated costs or revenues. In general, operating exposure does not include contracted cash flows (transaction exposure). This makes management much more difficult since the amount of future cash flows can only be approximated. Furthermore, these cash flows can include very longterm cash flows for which the forward market may not exist and the money market may be very costly (a schematic presentation of probable impact of depreciation of company s local currency on parent company s cash flow is depicted at the end of the report). No method can be completely effective, but the extent of operating exposure in many countries requires that all possible actions be taken and that every alternative in terms of revenue, cost and financial management be explored.
13 ANNEX: Schematic presentation of probable impact of depreciation of company s local currency (Rubles) on parent company s cash flow in US$ Category Likely Impact on Parent Company's Cash Flow in U.S. Dollars Export Markets Price and Volume Increase (by less than depreciation %) Increase Sales Revenue Strong Import Competition Price and Volume Increase Slightly Decrease Slightly Local Markets Weak or No Import Competition Price and Volume Remain the Same Decrease Low Import Component Increase Moderately Decrease Slightly Production Costs High Import Component Low Substituality Increase by Percentage of Currency Depreciation Decrease Sharply High Substituality Increase Moderately Decrease Slightly Other Costs and Working Capital Requirements Increase Moderately (depending on % increase in sales and costs) Decrease Slightly Depreciation Remain the same Decrease by Precentage of Currency Depreciation Overall Cash Flow Effect Decrease by Less than Percentage of Currency Depreciation
14 References: Economic Exposure, Darden Business Publishing, University of Virginia, 2009 Various lecture notes on Global Corporate Finance, NYU Stern School of Business, 2012 Financial Management for the Multinational Firm, Fuad A. Abdullah, 1987 Interpretation and Application of International Financial Reporting Standards, Wiley, 2013 Multinational Business Finance, Eiteman, David K.; Stonehill, Arthur I.; Moffett, Michael H., Addison Wesley, 2009
International Accounting Standard 21 The Effects of Changes in Foreign Exchange Rates Objective 1 An entity may carry on foreign activities in two ways. It may have transactions in foreign currencies or
Indian Accounting Standard (Ind AS) 21 The Effects of Changes in Foreign Exchange Rates Contents Paragraph OBJECTIVE 1-2 SCOPE 3-7 DEFINITIONS 8-16 Elaboration on the definitions 9-16 Functional currency
STATUTORY BOARD FINANCIAL REPORTING STANDARD SB-FRS 21 The Effects of Changes in Foreign Exchange Rates SB-FRS 21 The Effects of Changes in Foreign Exchange Rates was operative for Statutory Boards financial
Indian Accounting Standard (Ind AS) 21 The Effects of Changes in Foreign Exchange Rates (This Indian Accounting Standard includes paragraphs set in bold type and plain type, which have equal authority.
Institute of Chartered Accountants of New Zealand FINANCIAL REPORTING NO. 21 1997 FRS-21 Issued 12/97 Amended 04/98 ACCOUNTING FOR THE EFFECTS OF CHANGES IN FOREIGN CURRENCY EXCHANGE RATES Issued by the
CONSOLIDATED STATEMENT OF INCOME Notes Sales 1) 5,429,574 5,169,545 Cost of Goods Sold 2) 3,041,622 2,824,771 Gross Profit 2,387,952 2,344,774 Selling Expenses 3) 1,437,010 1,381,132 General and Administrative
IASB/FASB Meeting June 2010 week beginning 14 June IASB agenda reference FASB memo reference 2D 50D Project Topic Insurance Contracts Foreign currency cash flows Purpose of this paper 1. This paper deals
56 Neptune Orient Lines Limited (incorporated in Singapore) and its Subsidiaries Annual Report CONSOLIDATED INCOME STATEMENT FOR THE FINANCIAL YEAR ENDED 25 DECEMBER Continuing operations Revenue 4 5,382,596
SUMITOMO DENSETSU CO., LTD. AND SUBSIDIARIES Consolidated Financial Statements Report of Independent Public Accountants To the Board of Directors of Sumitomo Densetsu Co., Ltd. : We have audited the consolidated
Consolidated Financial Results for the First Two Quarters of the Fiscal Year Ending March 31, 2016 (Japan GAAP) Name of Listed Company: Yokogawa Electric Corporation (the Company herein) Stock Exchanges
Summary of significant accounting policies Basis of preparation DSM s consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted
Acal plc Accounting policies March 2006 Basis of preparation The consolidated financial statements of Acal plc and all its subsidiaries have been prepared in accordance with International Financial Reporting
Statement of Accounting Standards Foreign Currency Translation Prepared by the Accounting Standards Board and the Public Sector Accounting Standards Board of the Australian Accounting Research Foundation
FINANCIAL STATEMENTS TOGETHER WITH INDEPENDENT AUDITOR S REPORT FINANCIAL STATEMENTS CONTENTS PAGES BALANCE SHEET (STATEMENT OF FINANCIAL POSITION)... 1 STATEMENT OF COMPREHENSIVE INCOME... 2 STATEMENT
1 CONSOLIDATED FINANCIAL STATEMENTS (1) Consolidated Balance Sheets As of March 31,2014 As of March 31,2015 Assets Cash and due from banks 478,425 339,266 Call loans and bills bought 23,088 58,740 Monetary
Consolidated Financial Results for Fiscal Year 2013 (April 1, 2013 March 31, 2014) 28/4/2014 Name of registrant: ShinMaywa Industries, Ltd. Stock Exchange Listed: Tokyo Code number: 7224 (URL: http://www.shinmaywa.co.jp
46 Unless otherwise stated, the following accounting policies have been applied consistently in dealing with items which are considered material in relation to the financial statements. The Company and
Consolidated Balance Sheets June 30, 2015, December 31, 2014, and (June 30, 2015 and 2014 are reviewed, not audited) Assets 2015.6.30 2014.12.31 2014.6.30 Current assets: Cash and cash equivalents $ 36,400,657
ASML - Summary IFRS Consolidated Statement of Profit or Loss 1,2 Three months ended, Six months ended, Jun 29, Jun 28, Jun 29, Jun 28, 2014 2015 2014 2015 Net system sales 1,243.0 1,134.5 2,273.0 2,381.0
Tax accounting services: Foreign currency tax accounting October 2012 The globalization of commerce and capital markets has resulted in business, investment and capital formation transactions increasingly
Financial Statements SEIKAGAKU CORPORATION AND CONSOLIDATED SUBSIDIARIES Consolidated Balance Sheets March 31, 2001 and 2000 Assets Current assets: Cash and cash equivalents... Short-term investments (Note
167 Risk management Group risk management Group Risk Management supports the Board of Directors, the Executive Committee and the management teams of the Group companies in their strategic decisions. Group
1. Basis of Preparation The accounts have been prepared in accordance with Hong Kong Financial Reporting Standards ( HKFRS ). The accounts have been prepared under the historical cost convention as modified
CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2013 CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2013 NIS IN THOUSANDS INDEX Page Auditors' Reports 2-4 Consolidated Statements of Financial
Logwin AG Interim Financial Report as of 31 March 2015 Key Figures 1 January 31 March 2015 Earnings position In thousand EUR 2015 2014 Revenues Group 274,433 278,533 Change on 2014-1.5% Solutions 101,821
171 The most important exchange rates applied in the consolidated financial statements developed as follows in relation to the euro: Currency Average rate Closing rate Country 1 EUR = 2014 2013 2014 2013
3. CONSOLIDATED QUARTERLY FINANCIAL STATEMENTS (1) Consolidated Quarterly Balance Sheets September 30, 2014 and March 31, 2014 Supplementary Information 2Q FY March 2015 March 31, 2014 September 30, 2014
Financial Publication for Fiscal Year Ended March 31, 2009 June 30, 2009 Citibank Japan, LTD ( CJL ) 2-3-14 Higashi-shinagawa, Shinagawa-ku, Tokyo Representative Director, President & CEO Darren Buckley
Amadeus Global Travel Distribution, S.A. Consolidated Interim Financial Statements as of June 30, 2002, prepared in accordance with International Accounting Standard 34 and Review Report of Independent
International Financial Reporting Standard 7 Financial Instruments: Disclosures INTERNATIONAL FINANCIAL REPORTING STANDARD AUGUST 2005 International Financial Reporting Standard 7 Financial Instruments:
Consolidated Financial Statements For the year ended February 20, 2016 Nitori Holdings Co., Ltd. Consolidated Balance Sheet Nitori Holdings Co., Ltd. and consolidated subsidiaries As at February 20, 2016
Türkiye İş Bankası A.Ş. Separate Financial Statements As at and for the Year Ended 2015 29 April 2016 This report includes 93 pages of separate financial statements together with their explanatory notes.
Topic 9 Preparing a Successful Financial Plan LEARNING OUTCOMES By the end of this topic, you should be able to: 1. Describe the overview of accounting methods; 2. Prepare the three major financial statements
Abbey plc ( Abbey or the Company ) Interim Statement for the six months ended 31 October 2007 The Board of Abbey plc reports a profit before taxation of 18.20m which compares with a profit of 22.57m for
Consolidated Financial Report 2009 Fiscal year ended March 31, 2009 Management's Discussion and Analysis Forward-looking statements in this document represent the best judgment of the Kagome Group as of
Consolidated Statement of Financial Position Sumitomo Corporation and Subsidiaries As of March 31, 2016 and 2015 ASSETS Current assets: Cash and cash equivalents 868,755 895,875 $ 7,757 Time deposits 11,930
12.31.2014 CONSOLIDATED FINANCIAL STATEMENTS (Unaudited figures) CONTENTS Consolidated financial statements Consolidated balance sheet 1 Consolidated income statement 3 Statement of net income and unrealised
Transition to International Financial Reporting Standards Topps Tiles Plc In accordance with IFRS 1, First-time adoption of International Financial Reporting Standards ( IFRS ), Topps Tiles Plc, ( Topps
AS -11 THE EFFECTS OF CHANGES IN FOREIGN EXCHANGE RATES IPCC PAPER 5 ADVANCED ACCOUNTING CHAPTER 2 CA. ANAND J. BANKA OBJECTIVE An enterprise may carry on activities involving foreign exchange in two ways.
Note 1 to the financial information Basis of accounting ITE Group Plc is a UK listed company and together with its subsidiary operations is hereafter referred to as the Company. The Company is required
2009 IFRS Foundation: Training Material for the IFRS for SMEs Module 30 Foreign Currency Translation IFRS Foundation: Training Material for the IFRS for SMEs including the full text of Section 30 Foreign
SUMMARY OF CONSOLIDATED BUSINESS RESULTS for the nine months ended December 31, 2012 February 8, 2013 ARRK Corporation 2-2-9 Minami Hommachi, Chuo-ku, Osaka, 541-0054, JAPAN 1. Consolidated financial results
Consolidated Financial Results for the First Three Quarters of the Fiscal Year Ending March 31, 2016 (Japan GAAP) Name of Listed Company: Yokogawa Electric Corporation (the Company herein) Stock Exchanges
BALANCE SHEET Assets Property, plant and equipment: 30. 6. 2014 31. 12. 2013 Plant in service 319 440 319 081 Less accumulated provision for depreciation (188 197) (182 282) Net plant in service 131 243
Volex Group plc Transition to International Financial Reporting Standards Supporting document for 2 October 2005 Interim Statement 1. Introduction The consolidated financial statements of Volex Group plc
Consolidated Statements of Profit or Loss Sales: Products 1,041,794 1,071,446 8,928,717 Post sales and rentals 1,064,555 1,068,678 8,905,650 Other revenue 89,347 91,818 765,150 Total sales 2,195,696 2,231,942
136 ST ENGINEERING / ABOVE & BEYOND Independent auditors report Members of the Company Singapore Technologies Engineering Ltd Report on the financial STATEMENTS We have audited the accompanying financial
FINANCIAL ACCOUNTING FORMATION 2 EXAMINATION - AUGUST 2012 NOTES: You are required to answer Question 1. You are also required to answer any three out of Questions 2 to 5. (If you provide answers to all
1 (14) Summary of significant accounting policies The principal accounting policies applied in the preparation of Neste's consolidated financial statements are set out below. These policies have been consistently
[Translation: Please note that the following purports to be a translation from the Japanese original Notice of Convocation of the Annual General Meeting of Shareholders 2013 of Chugai Pharmaceutical Co.,
CONSOLIDATED STATEMENTS OF OPERATIONS For the years ended December 31, (in millions of Canadian dollars except for per share amounts) 2015 2014 Revenue Premiums Gross $ 16,824 $ 15,499 Less: Ceded 6,429
Chapter 9, Problem 7 Cost of 70% of Simon 900,000 Book value of Simon Common stock 550,000 Retained earnings Jan. 1 400,000 Net income to April 1 (¼ 200,000) 50,000 1,000,000 70% 700,000 Purchase discrepancy
MARUHAN Co., Ltd. Brief Report on Closing of (connection) for the Term Ended March 31, 2007 (Amounts less than 1 million yen omitted) 1.Business Results for the term ended on March, 2007 (From April 1,
ARE YOU TAKING THE WRONG FX RISK? Focusing on transaction risks may be a mistake Structural and portfolio risks require more than hedging Companies need to understand not just correlate the relationship
Consolidated Financial Statements for the year ended 31 December 2012 Contents Auditors Report Consolidated Statement of Comprehensive Income 5 Consolidated Statement of Financial Position 6 Consolidated
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS KANEKA CORPORATION AND CONSOLIDATED SUBSIDIARIES 1. BASIS OF PRESENTING CONSOLIDATED FINANCIAL STATEMENTS Kaneka Corporation (the Company ) and its consolidated
Cork Institute of Technology Bachelor of Business in Accounting Award Bachelor of Business in Management - Award Instructions Answer FOUR questions Answer all THREE questions in Section A and ONE question
To Those Shareholders with Voting Rights Notes to the Consolidated Financial Statements for the 92nd Fiscal Term Notes to the Non-Consolidated Financial Statements for the 92nd Fiscal Term The above documents
THE KINKI SHARYO CO., LTD. AND CONSOLIDATED SUBSIDIARIES CONSOLIDATED FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS' REPORT Years ended March 31, 2009 and 2010 ASSETS THE KINKI SHARYO CO., LTD. AND CONSOLIDATED
BALANCE SHEET Assets Property, plant and equipment: 31. 03. 2015 31. 12. 2014 Plant in service 345,012 344,246 Less accumulated provision for depreciation (199,841) (196,333) Net plant in service 145,171
IFRS IN PRACTICE IAS 7 Statement of Cash Flows 2 IFRS IN PRACTICE - IAS 7 STATEMENT OF CASH FLOWS TABLE OF CONTENTS 1. Introduction 3 2. Definition of cash and cash equivalents 4 2.1. Demand deposits 4
REFERENCE CONSOLIDATED FINANCIAL STATEMENTS FOR INFORMATION TO BE PUBLISHED IN RESPECT OF THE 2005 FINANCIAL YEAR EFFECTS OF THE TRANSITION TO IFRS ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER
LAFE CORPORATION LIMITED Un-audited Q1 2014 Financial Statement and Dividend Announcement (All in US Dollars) PART I INFORMATION REQUIRED FOR ANNOUNCEMENTS OF QUARTERLY (Q1, Q2 & Q3), HALF-YEAR AND FULL
interim Consolidated financial statements For the nine months ended September 30, 2011 and 2010 (Unaudited) consolidated financial statements 2 Condensed Interim Consolidated Statements of Operations and
Note 2 SIGNIFICANT ACCOUNTING POLICIES BASIS FOR THE PREPARATION OF THE FINANCIAL STATEMENTS The consolidated financial statements have been prepared in accordance with International Financial Reporting
Financial Statements For The Three Months Ended March 31, 2012 and 2011 With Independent Auditors Review Report The reader is advised that these financial statements have been prepared originally in Chinese.