Sony Corporation, headquartered in Tokyo, Japan, is one of the largest multinational companies in the world. While
Question:
Sony Corporation, headquartered in Tokyo, Japan, is one of the largest multinational companies in the world. While Sony’s financial reporting currency is the Japanese yen, the company’s foreign subsidiaries keep books in a variety of different currencies including the British pound, Euro, Indian rupee, Mexican peso, and U.S. dollar. In addition, Sony engages in international transactions denominated in currencies other than the Japanese yen. As a result, Sony must translate foreign currency receivables and payables into Japanese yen and also must translate each foreign subsidiary’s financial statements into Japanese yen to prepare consolidated financial statements.
Sony is one of the foreign companies listed on the NYSE, and therefore files an annual report on Form 20-F with the U.S. Securities and Exchange Commission (SEC) each year. Search the internet to access Sony Corporation’s Form 20-F for the fiscal year (FY) ended March 31, 2020.
Required:
Explain in your own words the policies that Sony uses to reflect the impact of changes in foreign exchange rates in its consolidated financial statements.
Step by Step Answer:
International Accounting
ISBN: 9781264556991
6th Edition
Authors: Timothy Doupnik, Mark Finn, Giorgio Gotti And Hector Perera