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FX Translation

JJames85004y ago
Hi, I do not understand why goodwill is re-translated at every reporting date. Goodwill only exists in the parents FS, therefore once calculated and translated into the parents functional currency at acquisition date- it remains in that currency? Thanks
stephenwidbergstephenwidbergTutor4y ago#1
It only exists in the GROUP accounts (not the parent accounts). Until 20 years ago, retranslation was not required. But, sometime around the millenium, they changed the rule. Logic - if you buy Disney based in the US, the goodwill is also in the US - that's where Mickey Mouse lives - so we have to retranslate the goodwill.
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