If a foreign operation is not autonomous and it has a high proportion of transactions with the reporting entity, the operation doesn't need to have the same functional currency as the reporting entity.

Question

Quizplus · Accepted Answer

The autonomy of a foreign operation and the proportion of transactions with the reporting entity do not determine whether it must have the same functional currency as the reporting entity. The functional currency is determined by the primary economic environment in which the entity operates, not by its relationship with the reporting entity.

If a Foreign Operation Is Not Autonomous and It Has