In order for the financial statements of a foreign operation to be included in the consolidated financial statements of the parent it is necessary to translate the foreign operation's financial statements into:
A) the presentation currency of the reporting entity;
B) the functional currency of the foreign operation;
C) the local currency of the foreign operation;
D) the domestic currency of the foreign operation;

Question

Quizplus · Accepted Answer

The financial statements of a foreign operation must be translated into the presentation currency of the reporting entity (the parent company) in order to be included in the consolidated financial statements. This ensures comparability and consistency across all operations included in the consolidated financial statements.

In Order for the Financial Statements of a Foreign Operation