# ASC 830-30-40: Foreign Currency Matters — Translation of Financial Statements — 40 Derecognition Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/830/30/#40-derecognition) Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective. Tables and mathematical or amendment markup are retained as HTML where Markdown would lose structure. Source downloaded (UTC): 2026-09-10T01:47:20.033Z to 2026-09-10T01:47:20.033Z Record version: sha256:f345f6a0906c43fb625f3727a0928a4b32d16dfdd587e6aea8bff24a28f9f4d9 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 830-30-40: 40 Derecognition [Read section](https://asc.understandingaccounting.org/asc/830/30/#40-derecognition) SEC content: no #### Sale or Liquidation of an Investment in a Foreign Entity ##### [830-30-40-1](https://asc.understandingaccounting.org/asc/830/30/#830-30-40-1) Pending content: no Source downloaded (UTC): 2026-09-10T01:47:20.033Z to 2026-09-10T01:47:20.033Z Record version: sha256:e468ca7a48d6f9453d0fc1bf5fea1c76056eb6430316d8cfc7d12d97901d37d1 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Upon sale or upon complete or substantially complete liquidation of an investment in a [foreign entity](https://asc.understandingaccounting.org/glossary/f/#foreign-entity "An operation (for example, subsidiary, division, branch, joint venture, and so forth) whose financial statements are both: Prepared in a currency other than the reporting currency of the reporting entity Combined or consolidated with or accounted for on the equity basis in the financial statements of the reporting entity."), the amount attributable to that entity and accumulated in the translation adjustment component of equity shall be both: 1. a Removed from the separate component of equity 2. b Reported as part of the gain or loss on sale or liquidation of the investment for the period during which the sale or liquidation occurs. ##### [830-30-40-1A](https://asc.understandingaccounting.org/asc/830/30/#830-30-40-1A) Pending content: no Source downloaded (UTC): 2026-09-10T01:47:20.033Z to 2026-09-10T01:47:20.033Z Record version: sha256:cb58a9e66876be0cb09fb64f505011ed6ffb17564a88488b026e5e4b432dbe5b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A sale shall include: 1. a The loss of a controlling financial interest in an investment in a foreign entity resulting from circumstances contemplated by Subtopic 810-10 (see paragraph [810-10-55-4A](https://asc.understandingaccounting.org/asc/810/10/#810-10-55-4A) for related implementation guidance) 2. b An acquirer obtaining control of an acquiree in which it held an equity interest, accounted for as an equity method investment that is a foreign entity, immediately before the acquisition date in a business combination achieved in stages (see paragraphs [805-10-25-9 through 25-10](https://asc.understandingaccounting.org/asc/805/10/#805-10-25-9) ). ##### [830-30-40-2](https://asc.understandingaccounting.org/asc/830/30/#830-30-40-2) Pending content: no Source downloaded (UTC): 2026-09-10T01:47:20.033Z to 2026-09-10T01:47:20.033Z Record version: sha256:ddb397ac6c4dc5effaed465b4e6b7de83385d5ee28dcdfa195e370a74d260e85 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If a [reporting entity](https://asc.understandingaccounting.org/glossary/r/#reporting-entity "An entity or group whose financial statements are being referred to. Those financial statements reflect any of the following: The financial statements of one or more foreign operations by combination, consolidation, or equity accounting Foreign currency transactions.") sells part of its ownership interest in an equity method investment that is a foreign entity, a pro rata portion of the accumulated translation adjustment component of equity attributable to that equity method investment shall be recognized in measuring the gain or loss on the sale. If the sale of part of an equity method investment that is a foreign entity results in the loss of significant influence, see paragraphs [323-10-35-37 through 35-39](https://asc.understandingaccounting.org/asc/323/10/#323-10-35-37) for guidance on how to account for the pro rata portion of the accumulated translation adjustment component of equity attributable to the remaining investment. For guidance if an entity sells a noncontrolling interest in a consolidated foreign entity, but still retains a controlling financial interest in the foreign entity, see paragraph [810-10-45-23 through 45-24](https://asc.understandingaccounting.org/asc/810/10/#810-10-45-23) . ##### [830-30-40-3](https://asc.understandingaccounting.org/asc/830/30/#830-30-40-3) Pending content: no Source downloaded (UTC): 2026-09-10T01:47:20.033Z to 2026-09-10T01:47:20.033Z Record version: sha256:189117b2a4de19f32168d085b30e01d451752943cfc24631b589c2ffc390a2e3 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Although partial liquidations by a parent of net assets held within a foreign entity may be considered similar to a sale of part of an ownership interest in the foreign entity if the liquidation proceeds are distributed to the parent, extending pro rata recognition (release of the cumulative translation adjustment into net income) to such partial liquidations would require that their substance be distinguished from ordinary dividends. Such a distinction is neither possible nor desirable. For those partial liquidations, no cumulative translation adjustment is released into net income until the criteria in paragraph [830-30-40-1](https://asc.understandingaccounting.org/asc/830/30/#830-30-40-1) are met. ##### [830-30-40-4](https://asc.understandingaccounting.org/asc/830/30/#830-30-40-4) Pending content: no Source downloaded (UTC): 2026-09-10T01:47:20.033Z to 2026-09-10T01:47:20.033Z Record version: sha256:e791c0c3017ffab0bbcc318a69c52d7662a05d8104255911c873cf68aeac205d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Under Subtopic 220-20, a gain or loss on disposal of part or all of a net investment may be recognized in a period other than that in which actual sale or liquidation occurs. Paragraph [830-30-40-1](https://asc.understandingaccounting.org/asc/830/30/#830-30-40-1) does not alter the period in which a gain or loss on sale or liquidation is recognized under existing generally accepted accounting principles (GAAP).