Which of the following statements is FALSE?
A) If a subsidiary is self-sustaining, the method of valuation of assets and liabilities is of no consequence in the translation because all of the assets are translated at the closing rate.
B) If a subsidiary is an integrated foreign subsidiary, the method of valuation of assets and liabilities is of no consequence in the translation because all of the assets are translated at the closing rate.
C) If a subsidiary is an integrated foreign subsidiary, a write-down to market may be required in the translated financial statements.
D)If a subsidiary is an integrated foreign subsidiary, no write-down is required in the foreign currency financial statements.

Question

Quizplus · Accepted Answer

This statement is false because for an integrated foreign subsidiary, the method of valuation of assets and liabilities is important in the translation as some assets and liabilities may be translated at historical rates or at the current rate. The closing rate is only used for non-monetary items and equity.

Which of the Following Statements Is FALSE