An entity may change its functional currency when there is a change in the underlying transactions,events and conditions.

Question

Quizplus · Accepted Answer

According to IAS 21 The Effects of Changes in Foreign Exchange Rates, an entity may change its functional currency when there is a change in the underlying transactions, events and conditions, such as a change in the nature of the entity's activities, location of its operations, financing arrangements or economic indicators. Therefore, the statement is true.

An Entity May Change Its Functional Currency When There Is