ABSTRACT
Three times the profession has overhauled its translation rules to deal with the problem caused by the need to include amounts for foreign operations in consolidated (or combined) financial statements, resulting in four different sets of translation rules. The origin of the problem is that arithmetic can’t be soundly or informatively applied, for example, to the amounts of assets and liabilities and changes in them of a U.S. parent company stated in terms of U.S. dollars and those of its UK subsidiary stated in terms of pounds sterling. But the solution isn’t immediately obvious.
