Kapitalerhaltung bei Anwendung der erfolgsneutralen Stichtagskursmethode zur Währungsumrechnung
Different methods for the translation of financial statements of foreign subsidiaries result in different profit contributions in the consolidated financial statements and accordingly to different amounts of capital maintained as measured in the group's reporting currency. The translation methods imply assumptions about the validity of macro-economic equilibria such as the Purchasing Power Parity or the Fisher Effect. A model contrasting central and local capital maintenance is developed under the assumption that the International Fisher Effect is valid. The consumption of capital is analyzed when the closing rate method is used with exchange differences offset against capital. This method is prevalent under the application of the functional method according to IAS 21 and SFAS 52. An empirical analysis shows that the impact on the consolidated financial statements of the DAX 30 companies for fiscal year 2004 is significant. With respect to this evidence accounting measures may be misleading for economic decisions or judgements.
|Date of creation:||2005|
|Date of revision:|
|Contact details of provider:|| Postal: Sonnemannstraße 9-11, 60314 Frankfurt am Main|
Phone: 069 154008-0
Web page: http://www.frankfurt-school.de/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Husted, Steven & Kitchen, John, 1985. "Some Evidence on the International Transmission of U.S. Money Supply Announcement Effects," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 17(4), pages 456-66, November.
When requesting a correction, please mention this item's handle: RePEc:zbw:fsfmwp:67. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (ZBW - German National Library of Economics)
If references are entirely missing, you can add them using this form.