- CFA Exams
- CFA Level I Exam
- Study Session 5. Financial Reporting and Analysis (1)
- Reading 15. Multinational Operations
- Subject 4. Translation: The All-Current Method
CFA Practice Question
Which of the following statements about the current rate method is true?
A. The current rate method is utilized by relatively independent entities that operate primarily in local markets.
B. The current rate method is required for use in hyperinflationary economies.
C. The current rate method is utilized primarily for non-US subsidiaries whose operations are primarily conducted in the parent's presentation currency.
Explanation: Entities that are significantly integrated with the parent company primarily utilize the temporal method.
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