If a parent company has an autonomous subsidiary in a country where the cumulati

Question

If a parent company has an autonomous subsidiary in a country where the cumulative rate of inflation for the past three years is more than 100 percent, which translation methodology would they use according to the US GAAP?

the current rate method.

the temporal method after adjusting for inflation.

the temporal method.

the current rate method after adjusting for inflation.

the current rate method.

the temporal method after adjusting for inflation.

the temporal method.

the current rate method after adjusting for inflation.

Explanation / Answer

c) the temporal method. Correct option

Under US GAAP, no inflation restatement is required and temporal method is used.

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