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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA SBR Exams › translating a foreign subsidiary for consolidation
Hi
when translating the goodwill, why do we use the closing value of the currency and not the historic value of currency (i.e. on the day of acquisition)?
thank you in advance for your help, which I very much appreciate!
Hi,
All assets and liabilities of the subsidiary are translated at the closing rate, including the goodwill. The movement on the FX differences related to goodwill are recognised through OCI.
Thanks
that’s really clear. Thanks again, Christopher!