__________________ is a measure of the impact of currency values on the financial statements of a firm.
A)Translation exposure
B)Operating exposure
C)Transaction exposure
D)Accounting exposure

Question

Quizplus · Accepted Answer

Accounting exposure is a measure of the impact of currency fluctuations on a firm's financial statements. It focuses on the effects of exchange rate changes on the translation of foreign currency assets and liabilities into the domestic currency for financial reporting purposes. It is also known as financial reporting exposure. Translation exposure, on the other hand, measures the potential impact of currency movements on a firm's consolidated financial statements. Operating exposure deals with the impact of currency fluctuations on the firm's future cash flows, while transaction exposure is concerned with the effect of exchange rate changes on the value of specific transactions that are denominated in foreign currencies.

__________________ Is a Measure of the Impact of Currency Values