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Are forex translation adjustments on corporate financials due to strong USD real losses in time?


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I'm reading this - https://www.cohencpa.com/knowledge-center/insights/november-2020/do-you-fully-understand-the-impact-of-foreign-currency-on-your-financial-statements


and it says comprehensive income statement includes the effect of foreign exchange.


Today the USD is strong so many companies with foreign income actually made no money in USD!! It's amazing the stocks don't tank.


Yet I wonder if these will reverse or not. What if the USD stays strong forever? At what point do you take the loss? When you convert the currency back to usd?

But even if you never convert it, its buying power will always be less so all earning statements should only be then relied about using the comprehensive income.

In some cases zero for several years if USD stays strong and unhedged.


Also this statement, "That amount will be presented on the consolidated cash flow statement as “effect of exchange rates on cash and cash equivalents.” There is a tendency to have this amount equal the current year translation amount presented in accumulated comprehensive income — but this would be incorrect! If these two amounts agree, the cash flow statement is not right."


Does anyone understand what this means? Why the two should not match? Is it because the cash-flow statement also includes foreign cash in the bank?

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