Re: Playing Accountant

[Gerd-Christian Michalke]

On Mon, 19 Mar 2001, Derek A. Neighbors wrote:

> > If you track expenses using dollars, and attach dates to transactions
> > and/or prices, then the problems can get deferred until _reporting_
> > time.  The critical thing is to track enough information to make sure
> > that reporting can be done unambiguously.
> 
> Yes same goes for chart of account changes etc in my book. 
>  
> > Quite frankly, the only time anybody plays with the differing
> > standards on this is when they are undergoing vast amounts of
> > inflation.  A few percent per annum doesn't count :-).

helas, it _does_ matter. Maybe not in the USA, but well in Europe. And not
taking into account these differences can bring you quite a lot of
trouble.

> 
> Yes and with recent situations like Russia and Mexico I think that bears
> some relevance due to our multi national aspect.  

well. Anyway, if you do accounting, you have to bear in mind the exchange
rate, and only if it is some %. 1% on a billion $ is quite a lot. And,
please, do not forget that in europe we have the euro which has deprecated
quite a lot (from 1.10$ to 0.95$. So don't forget this one.

I have really no idea about the accounting in the USA, but I guess it can
be quite different from the one used in Europe (and even there, accounting
differs from one country to the other).

Any exchange deprecation/appreciation is accounted (when depends on the
actual kind of the amount: be it a debt, or an inventory or something
else).

But then, you have to save the exchange rate when the operation (let's say
a selling of goods) was done, and the exchange rate when the rate
difference was taken into the accounts.

> 
> 
> Derek Neighbors
> 
> 

Gerd C.  Michalke (Belgium/Europe)