IAS 21Chapter 7Lesson 1
The net investment in a foreign operation
Step 1 of 7Learning objectives
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A loan to a foreign subsidiary whose settlement is neither planned nor likely is treated as an extension of the investment: its exchange difference goes to profit or loss in the separate statements and to other comprehensive income on consolidation.
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Learning objectives
- Define the net investment in a foreign operation.
- Place the exchange difference of such an item in profit or loss or other comprehensive income depending on the statements.
- Analyse the currency-of-denomination cases of an item of the net investment.