A U.S. parent has a wholly-owned subsidiary in Switzerland. The subsidiary's accounts are reported in Swiss francs. Under what circumstances will the U.S. parent translate the subsidiary's accounts from Swiss francs to U.S. dollars?

Question

Quizplus · Accepted Answer

The functional currency of the subsidiary is the Swiss franc, which is different from the U.S. dollar, the parent company's currency. Therefore, the subsidiary's accounts must be translated from Swiss francs to U.S. dollars.

A US Parent Has a Wholly-Owned Subsidiary in Switzerland