Review Question 1 Explain the financial reporting issue that arises when a company enters into foreign currency transactions. Provide examples of various foreign currency transactions and indicate whether each transaction involves the initial recognition of a monetary item or non-monetary item or both.

Review Question 5 Explain what is meant by the term 'exchange difference'. Distinguish between an unrealised exchange loss and a realised exchange loss. Provide an overview of the accounting requirements of AASB 121/IAS 21 in relation to foreign currency transactions and exchange differences.

Review Question 9 If land or inventory can only be realised in foreign currency, then how should the recoverable amount of the land or realisable value of the inventory be measured?