E 14-2 Translation/remeasurement differences 1. When consolidated financial statements for a U.S. parent and its foreign subsidiary are prepared, the account balances expressed in foreign currency must be converted into the currency of the reporting entity. One objective of the translation process is to provide information that:

a Reflects current exchange rates b Reflects current monetary equivalents c Is compatible with the economic effects of rate changes on the firm’s cash flows d Reflects each translated account at its unexpired historical cost