CFM86110 - Old rules: forex and accounts drawn up in a foreign currency: pre-2005

Accounts drawn up in a foreign currency: periods beginning before 1 January 2005

For accounting periods beginning before 1 January 2005, the rules on translating foreign exchange transactions and accounting figures into sterling were geared to the accounting treatment in Statement of Standard Accounting Practice (SSAP) 20. This part of the guidance covers three topics:

• The exchange rate at which companies that account in sterling should translate foreign currency receipts, expenses, assets, liabilities and derivative contracts (CFM86120).
• Incorporating the business results of a branch or part business that accounts in a foreign currency, into a company’s overall sterling corporation tax profit or loss (CFM86140).
• Incorporating the results of the part business where the company does not have sterling as its reporting currency, in other words where the accounts are drawn up in a foreign currency and currency transactions are in point (CFM86190).