So, it would apply to a business where it operates in a country that has its own currency but the business’s trade is say in oil/gas, which the price of which is very much determined by the $USD. Also the equipment required to purchase the oil extraction equipment is denominated in $USD, so even though the business operates in a country which has its own current (say Nigeria and its Naira) the functional currency of the business would be the $USD.
Don’t worry too much as you won’t see this in FR but it could be seen in SBR for instance.