# ASC 830-946-45: Foreign Currency Matters — Financial Services—Investment Companies — 45 Other Presentation Matters Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/830/946/#45-other-presentation-matters) 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): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:197a9593e893c885e4193c4d48e53d66133e66ee1b9015512d3ac137035b9744 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 830-946-45: 45 Other Presentation Matters [Read section](https://asc.understandingaccounting.org/asc/830/946/#45-other-presentation-matters) SEC content: no #### Overall Guidance ##### [830-946-45-1](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-1) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:d29ea59ec1a9e5a70cb6fb80e9b5aa22ee5b1539882afa5d6eb1f49c9c6a4d29 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The ongoing revaluation of investments and receivables or payables representing unsettled foreign currency transactions shall be classified as unrealized foreign currency gain or loss. On settlement (when there is actual cash flow), a realized foreign currency gain or loss shall be recorded. ##### [830-946-45-2](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-2) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:9a9c8d2e519ffeab246179808ae318453b72482ea6948df38edecb072815f81e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Each transaction denominated in a foreign currency can initially be measured only in that currency. Any differences between originally recorded amounts and currently consummated or measured amounts in the reporting currency are a function of both of the following factors: 1. a Foreign exchange rate changes 2. b Changes in market prices. ##### [830-946-45-3](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-3) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:75e673cdd9009c433e71a0214ae786d69085615e20fe5a919e190839e9c093e7 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Those effects shall be identified, computed, and reported other than for gains and losses on investments. ##### [830-946-45-4](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-4) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:4e5b2145f7e0a3526144caad755de53013a5375f6f51cbfe6885c4b612d063b6 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The practice of not separately disclosing the portion of the changes in [fair values](https://asc.understandingaccounting.org/glossary/f/#fair-value "The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.") of investments and realized gains and losses thereon that result from foreign currency rate changes is permitted. However, separate reporting of such gains and losses is allowable and, if adopted by the reporting entity, shall conform to the guidance in this Subtopic. ##### [830-946-45-5](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-5) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:f20b27e58498932ea1bfcaf976d77bc2063525e90a2cf944d34590f32000bacd Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For funds that invest in countries that are highly inflationary, the separate measurement and disclosure of the foreign currency element may not be meaningful. ##### [830-946-45-6](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-6) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:0ddbe01f7da1eb1cde9ec9050ca20f71de647aebcbe9610df72626746fc09c55 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The remainder of the guidance in this Section is organized as follows: 1. a Cash 2. b Derivative instruments—forward exchange contracts 3. c Securities 4. d Receivables and payables 5. e Income 6. f Expenses 7. g Financial statement presentation. #### Cash ##### [830-946-45-7](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-7) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:7976c94244558f22c19a7625d1cd80f10ca5bace7fd8f0ffe2654cb014818836 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Foreign currency cash balances and movements shall be accounted for in the same way that foreign-currency-denominated securities are. Every receipt of a foreign currency shall be treated as a purchase of a security and recorded in the functional currency at the [spot rate](https://asc.understandingaccounting.org/glossary/s/#spot-rate "The exchange rate for immediate delivery of currencies exchanged.") on the cash receipt date. Similarly, every disbursement of a foreign currency shall be treated as a sale of a security and the appropriate functional currency cost shall be released, depending on whether a specific identified cost, the first-in, first-out (FIFO) method, or an average cost is used. ##### [830-946-45-8](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-8) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:25f4b96e2d4d22250a5b85d63a8c5500f21d0c8a97049f6f3fcd5456f898a08f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The acquisition of a foreign currency does not result in any foreign currency gain or loss. However, the disbursement of a foreign currency shall result in a realized foreign currency gain or loss that is the difference between the functional currency equivalent of the foreign currency when it was acquired and the foreign currency disbursement translated at the spot rate on the disbursement date. ##### [830-946-45-9](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-9) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:c2f6ddbf1768b0b75c76dd72ee100bc555e59c71bf4053bef72da68eb205c278 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Also, as is the case with all other assets and liabilities denominated in a foreign currency, foreign currency cash balances shall be translated on each valuation date at the spot rate on that date, resulting in unrealized foreign currency gain or loss. #### Derivative Instruments—Forward Exchange Contracts ##### [830-946-45-10](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-10) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:5ab10034dc0578effb96e43e13c0cd39cb13ec1a34d6af71d51312b6110ddefb Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If a fund enters into a [forward exchange contract](https://asc.understandingaccounting.org/glossary/f/#forward-exchange-contract "A forward exchange contract is an agreement between two parties to exchange different currencies at a specified exchange rate at an agreed-upon future date."), the forward contract shall be recorded on the inception date at the forward rate and subsequently measured at fair value daily. ##### [830-946-45-11](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-11) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:ffdd5ca3d2b40aa1c72969d94269a3182f60cc273b5bc538865295ff5012e329 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The unrealized foreign currency gain or loss on such a contract is the difference between the foreign currency amount valued at the forward rate (on the valuation date) and the original contracted value of the forward contract (the amount to be received or paid at expiration or settlement date). On the expiration or settlement date, the unrealized foreign currency gain or loss shall be reclassified as realized foreign currency gain or loss. ##### [830-946-45-12](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-12) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:1bb88caef34e02e3ea09d8bc85fe8c104b0f00b7af9527110d416373356a4917 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If the forward contract is meant to hedge the payable for the purchase of a security denominated in a foreign currency, the cost of the investment purchased and the related payable that has been hedged by the forward contract shall still be recorded at the spot rate on the trade date, and the payable shall be translated into the functional currency daily. #### Securities ##### [830-946-45-13](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-13) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:43fca9dac7927ef16920b8f6d4721058d655916adc67335aed655d312ee8f015 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance on foreign currency matters related to securities is organized as follows: 1. a Purchased interest 2. b Subsequently measuring at fair value 3. c Sale of securities 4. d Sale of interest. ##### [830-946-45-14](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-14) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:0b4af58610510070417cc9021694467a90b51d84a95abe5cbc7817bc5a866070 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Purchased interest represents the interest accrued between the last coupon date and the settlement date of the purchase. It should be recorded in the functional currency as interest receivable at the spot rate on the purchase trade date, and subsequently measured at fair value using each valuation date's spot rate. After the settlement date, daily interest income should be accrued at the daily spot rate. It may be impractical to prepare the foregoing calculations daily, and, therefore, the use of a weekly or monthly average rate may be appropriate in many cases, especially if the exchange rate does not fluctuate significantly. However, if the exchange rate fluctuation is significant, the calculation should be made daily. ##### [830-946-45-15](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-15) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:6735db520248874075a090aaf6fdc675df5a1dbe1aef37f1dae4d5d03ff2bc2d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A fund investing in foreign securities generally invests in such securities to reap the potential benefits offered by the local capital market. It may also invest in such securities as a means of investing in the foreign currency market or of benefiting from the foreign currency rate fluctuation. The extent to which separate information regarding foreign currency gains or losses will be meaningful will vary depending on the circumstances, and separate information may not measure with precision foreign exchange gains or losses associated with the economic risks of foreign currency exposures. A foreign currency rate fluctuation, however, may be an important consideration in the case of foreign investments, and a reporting entity may choose to identify and separately report any resulting foreign currency gains or losses as a component of unrealized fair value gains or losses on investments. ##### [830-946-45-16](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-16) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:23810a8c24d899e5dcf2e6c6bc2c55f89d7deb8f8948fd70e9d276c2553f25aa Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The fair value of securities shall initially be determined in the foreign currency and translated at the spot rate on the purchase trade date. The unrealized gain or loss between the original cost (translated on the trade date) and the fair value (translated on the valuation date) comprises both of the following elements: 1. a Changes in the fair value of securities before translation 2. b Movement in foreign currency rate. ##### [830-946-45-17](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-17) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:bee68eb3c28fe24baae3ed4773d4f6a4b3ec9e32f15d07ea0ef61898671b0d86 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Such movements may be combined as permitted by paragraph [946-830-45-4](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-4). If separate disclosure of the foreign currency gains and losses is chosen, the changes in the fair value of securities before translation should be measured as the difference between the fair value in foreign currency and the original cost in foreign currency translated at the spot rate on the valuation date. The effect of the movement in the foreign exchange rate shall be measured as the difference between the original cost in foreign currency translated at the current spot rate and the historical functional currency cost. These values can be computed as follows: 1. a (Fair value in foreign currency - original cost in foreign currency) x valuation date spot rate = unrealized fair value appreciation or depreciation. 2. b (Cost in foreign currency times valuation date spot rate) - cost in functional currency = the unrealized foreign currency gain or loss. ##### [830-946-45-18](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-18) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:34ed462b7cccd51667db55a98997d0b97d305f57a49a6f17650bdcea74e356e8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The preceding formulas could be refined to isolate and report the rate change element in the changes in the gains or losses on investments between valuation dates. However, the cost of doing so would not be justified for the relatively minor improvement thereof. Furthermore, such refinement would both: 1. a Be a departure from the method required for federal income tax reporting for realized foreign currency gains or losses on debt securities 2. b Represent a departure from the practice of those investment companies that presently separately report in their financial statements the effects of foreign exchange on securities gains or losses. ##### [830-946-45-19](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-19) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:aba3cdf710bece97135397188386da59cd0be33d19dabbe1e09a7f57905601d8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For short-term securities held by a fund that follows the amortized cost method of valuation, the amortized cost value should be substituted for fair value in the formulas given in the preceding two paragraphs if separate reporting is chosen by the reporting entity. ##### [830-946-45-20](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-20) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:845565c3ddfae13de8ecba8b4194caa9325228b506bdb0e6c6305a281cd408c5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If separate reporting of foreign currency gains and losses on sales of securities is chosen by the reporting entity, the computation of the effects of the changes in fair value and the foreign currency rate is similar to that described in paragraphs [946-830-45-17 through 45-18](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-17) . Fair value in the formula given in those paragraphs should be replaced with sale proceeds and valuation date shall be replaced with sale trade date. Accordingly, the values shall be computed as follows: 1. a (Sale proceeds in foreign currency - original cost in foreign currency) x sale trade date spot rate = realized fair value gain or loss on sale of security. 2. b (Cost in foreign currency x sale trade date spot rate) - cost in functional currency = realized foreign currency gain or loss. ##### [830-946-45-21](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-21) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:c7ede6692920f508130a78f0fc573b3a743ffe741bd4500591aa9daaa72dcd6c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The sale of a security results in a receivable for the security sold. The related receivable shall be recorded on the trade date at the spot rate. On the settlement date, the difference between the recorded receivable amount and the actual foreign currency received converted into the functional currency at the spot rate shall be recognized as a realized foreign currency gain or loss. ##### [830-946-45-22](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-22) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:4848cc0418a22570f1896deb3194476261586c34525994d3182dcd0dfcd7a14b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Interest sold represents the accrued interest receivable between the last coupon date and the settlement date of sale of the security. The difference between the recorded interest receivable amount and the actual foreign currency received (converted into the functional currency at the spot rate) shall be recognized as a realized foreign currency gain or loss. #### Receivables and Payables ##### [830-946-45-23](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-23) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:fde062cf93c6f4fd6479b8c836c9614fd189e690b7893380de4cd55d9a0d7bac Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. All receivables and payables that are denominated in a foreign currency and that may relate to income or expense, or to securities sold or purchased, shall be translated into the functional currency each valuation date at the spot rate on that date. The difference between that amount and the functional currency amount that was recorded at various spot rates for income and expense items, and at the trade date spot rate in the case of sales and purchases of securities, is unrealized foreign currency gain or loss. Upon liquidation of the receivable or payable balance in a foreign currency, the difference shall be reclassified as realized foreign currency gain or loss. #### Income ##### [830-946-45-24](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-24) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:47cb10ade254cc35d2f2d6649d8c85ef3fdc6d043d2a5b7977acd1dd75cfd336 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This guidance on foreign currency matters involving income is organized as follows: 1. a Interest 2. b Accretion and amortization 3. c Dividends 4. d Withholding tax. ##### [830-946-45-25](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-25) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:96476969fadaac9f1203623768fa9e891efdaf3dc9b3b323b37f2588d45e8f09 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Interest on securities denominated in a foreign currency shall be calculated at the stated rate of interest in the foreign currency. The interest shall be accrued daily in the foreign currency at the stated interest rate and translated into the functional currency at the daily spot rate. It may be impractical to prepare such a calculation daily, and, therefore, the use of a weekly or monthly average rate may be appropriate in many cases, especially if the exchange rate does not fluctuate significantly. However, if the exchange rate fluctuation is significant, the calculation shall be made daily. ##### [830-946-45-26](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-26) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:7ce530da7b11d3e665e35184748d12b07890c58eacf4e4ab8ba9af750d1ff4e8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The related receivable balance along with purchased interest, if any, shall be accumulated in the foreign currency and translated into the functional currency daily using the spot rate for that date. The difference between the income accrued in the functional currency and the foreign currency receivable at the valuation date spot rate shall be recognized as an unrealized foreign currency gain or loss. ##### [830-946-45-27](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-27) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:62262d7b03344000a04624a9e2e2ea5382f9dd0bba681d9f2a480aa1af6e9cef Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. When the interest is received and recorded in the functional currency at the spot rate on that date, the unrealized foreign currency gain or loss shall be reclassified as realized foreign currency gain or loss. ##### [830-946-45-28](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-28) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:ac03f2a8646c22107a167e1ca4b7e4f378c3916b1e64d4f6cef80d3d03ce4840 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Accretion of discounts and amortization of premiums on bonds shall be calculated daily in the foreign currency. The resulting amount of income or offset to income shall be translated into the functional currency using that day's spot rate. The same foreign currency amount shall be recorded as an addition to cost for accretion of discounts and a reduction to cost for amortization of premiums. Accordingly, cost consists of the original cost, translated at the spot rate in effect on the trade date the bond was bought and adjusted for discount accretion or premium amortization at the spot rate on the date of adjustment. As stated in paragraph [946-830-45-25](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-25), use of a weekly or monthly average rate may be appropriate in certain circumstances. ##### [830-946-45-29](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-29) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:f67072148be576205e5e7d33548c62f078ada4147faea66411a52e07aea4dfbd Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. On maturity, the carrying cost (including accretion or amortization) of the security in the foreign currency equals the proceeds. However, this will not be the case in the functional currency. The original cost shall be translated into the functional currency at the spot rate on the trade purchase date and the accretion or amortization shall be translated at periodic spot rates. The proceeds shall be translated into the functional currency at the spot rate on the maturity date. The difference between the proceeds and the accumulated cost in the functional currency shall be recognized as a realized foreign currency gain or loss. ##### [830-946-45-30](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-30) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:3b90cef48eb0ed9ea1509e3373f286fa07400dd97d9b1965a0c3355bab564ba4 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Recording dividends on foreign securities is often difficult because, in certain countries, entities customarily declare dividends retroactively or there is a lack of timely information. Additionally, in some countries, the sequencing of the declaration date and ex-dividend date may be different from the sequencing of these dates in the United States, thus necessitating a modification of the practice of recording dividends on the ex-dividend date (see paragraph [946-320-35-5](https://asc.understandingaccounting.org/asc/320/946/#320-946-35-5)). Also, foreign entities often declare stock dividends instead of cash dividends or take other corporate actions such as issuing rights or warrants. ##### [830-946-45-31](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-31) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:d5e28fd7f2668c586d9c7cc893255726749c4bf55f733bf6257b1fe0624c9b72 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Dividend income on securities denominated in foreign currency shall be recorded on the ex-date, at the spot exchange rate of the foreign currency to the reporting currency on that date. The related dividend receivable shall be translated into the functional currency daily at the spot rate, and the difference between the dividend accrued in the functional currency and the foreign currency receivable at the valuation date spot rate shall be recognized as an unrealized foreign currency gain or loss. When the dividend is received, the unrealized foreign currency gain or loss shall be reclassified as realized foreign currency gain or loss. ##### [830-946-45-32](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-32) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:5368295b759d807cc1771c1a54791329ba0e3f9440deaa42c285212a19b06d73 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The preceding approach to measuring investment income ensures that investment income accrued on foreign securities reflects the investment transaction without regard to the foreign currency gain or loss created in the time between the accrual and collection of the income. ##### [830-946-45-33](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-33) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:bbd79e48cf228287708c59b81d93be32a1a478f38dc28854be1602002dbddc8c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Many foreign countries do not tax capital gains on investments by foreign investors; however, if such gains are taxable, an accrual for capital gains taxes payable on both realized and unrealized gains shall be included in the [net asset value per share](https://asc.understandingaccounting.org/glossary/n/#net-asset-value-per-share "Net asset value per share is the amount of net assets attributable to each share of capital stock (other than senior equity securities, that is, preferred stock) outstanding at the close of the period. It excludes the effects of assuming conversion of outstanding convertible securities, whether or not their conversion would have a diluting effect.") calculation. ##### [830-946-45-34](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-34) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:6439eae6da320f10b241c019c7eee09d29afb029a6b8bf2daa473eabf5a1b7ef Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Whenever tax is withheld from investment income at the source, the amounts withheld that are not reclaimable shall be accrued along with the related income on each income recognition date if the tax rate is fixed and known. If the tax withheld is reclaimable from the local tax authorities, it shall be recorded as a receivable and not as an expense. When the investment income is received net of the tax withheld, a separate realized foreign currency gain or loss shall be computed on the gross income receivable and the accrued tax expense. If the tax rate is not known or estimable, such expense or receivable shall be recorded on the date the net amount is received; accordingly, there would be no foreign currency gain or loss. However, if a receivable is recorded, there may be a foreign currency gain or loss through the date such receivable is collected. #### Expenses ##### [830-946-45-35](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-35) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:0e5e3f86edaad6522fdd5d4fc0b57d04d083e904689ac6f4799c9347b7f41223 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The accounting for expenses payable in a foreign currency is identical to that for investment income receivable in a foreign currency. An expense shall be accrued as incurred and translated into the functional currency at the spot rate each day. The use of an average weekly or monthly foreign currency rate would be acceptable if the foreign currency rate does not fluctuate significantly. The related accrued expense balance shall be accumulated in the foreign currency and translated into the functional currency daily, using the spot rate for that date. The difference between the expense accrued in the functional currency and the related foreign currency accrued expense balance translated into the functional currency at the valuation date spot rate shall be recognized as an unrealized foreign currency gain or loss. When the expense is paid, the unrealized foreign currency gain or loss shall be reclassified as realized foreign currency gain or loss. #### Financial Statement Presentation ##### [830-946-45-36](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-36) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:ddff3b1027dbf0498f0ab6d76e1d6a8c48b17866b9acc6fb8dad66e69913fd0b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An investment company is not required to separately disclose that portion of unrealized and realized gains and losses on investments that results from foreign currency changes. All other foreign currency gains or losses shall be reported under the realized and unrealized gain or loss on investments and foreign currency section in the statement of operations. ##### [830-946-45-37](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-37) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:603315b5ad95bdd03204571b3d45bd17b902730ed8278f70b21b8dbbfa5656bb Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For example, realized foreign currency gain or loss on interest and dividends shall be included in the realized foreign currency gain or loss component of net realized gain or loss. All unrealized foreign currency gain or loss, other than those on investments, shall be reported as unrealized appreciation or depreciation on translation of assets and liabilities in foreign currencies. The statement of changes in net assets and the statement of assets and liabilities shall reflect the same realized and unrealized gain and loss components. However, it is permissible to report each of the following items as single components in those statements: 1. a The combination of the net realized gains or losses from investments with net realized gains or losses from foreign currency transactions 2. b The combination of the net unrealized appreciation (depreciation) on investments with the net unrealized appreciation (depreciation) on translation of assets and liabilities in foreign currencies. ##### [830-946-45-38](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-38) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:f201b0a73cf6763b7b3ed033ffbe655f2c6f1bdd2b88d6bd921a38504f464b10 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If separate reporting of the unrealized and realized foreign currency gains or losses on investments is chosen, such gains and losses shall be aggregated with all other foreign currency gains and losses and reported as described in the preceding paragraph. ##### [830-946-45-39](https://asc.understandingaccounting.org/asc/830/946/#830-946-45-39) Pending content: no Source downloaded (UTC): 2026-09-10T01:48:02.598Z to 2026-09-10T01:48:02.598Z Record version: sha256:b239ab87032129fde401ac6ee4d4a1d07ed3da9c21284b3a422947c643ae2a31 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Taxes withheld that are not reclaimable, if any, on foreign source income shall be deducted from the relevant income item and shall be shown either parenthetically or as a separate contra item in the income section of the statement of operations. Taxes levied on the aggregate income or capital gains of the investment company itself shall be presented in a manner that is similar to that used for income taxes. The normal withholding taxes shall be presented as follows. - ![ ](https://asc.understandingaccounting.org/asc-img/GUID-83A70638-9B6B-4B96-850A-822199350D19-low.gif) Interest or dividend income (net of withholding taxes of $ X) $XXX or Interest or dividend income $XXX Less withholding tax (XXX)