Accounting standard currency, also known as functional currency, refers to the currency in the main environment in which each unit engages in production operations and business activities. It is the measurement currency of each unit. A unified measure of its capital flows and business operating results. Foreign currency refers to currencies other than the domestic currency. In accounting, it usually refers to various currencies other than the standard currency for accounting.
According to the provisions of the financial standards, each unit should use RMB as its accounting currency. Units whose business income and expenditure are mainly in foreign currencies can also choose some kind of currency. Foreign currency is the functional currency for accounting, but it should be converted into RMB when submitting statements to relevant government departments.
2 Accounting Exchange rate and book exchange rate
Accounting exchange rate refers to the calculation and recording of each unit The exchange rate used when conducting transactions in foreign currencies. Bookkeeping exchange rates are divided into fixed exchange rates and variable exchange rates. The so-called fixed exchange rate refers to the accounting exchange rate that remains unchanged within a certain period. For example, the exchange rate on the 1st of the month or the end of the previous quarter is used as the accounting exchange rate and remains unchanged during this month or quarter. The variable exchange rate refers to the accounting exchange rate that changes frequently based on changes in the foreign exchange quotation. If the foreign exchange quotation of the day is used as the accounting exchange rate, the accounting exchange rate will change every day.
The book exchange rate refers to the registered exchange rate adopted by the enterprise. The book exchange rate can be determined using the first-in-first-out method, transaction-by-transaction identification method, month-end adjustment method, weighted average method, etc.
3 Exchange gains and losses
Exchange gains and losses refer to the foreign currency deposits, foreign currency borrowings and use of each unit. Changes in current accounts settled in foreign currencies and differences arising from the conversion between two different foreign currencies include two meanings: First, the ending balance of the foreign currency account is converted into the amount in the recording currency according to the country's foreign exchange quotation at the end of the period and The difference between the amounts recorded in the accounting functional currency recorded at the book exchange rate; the second is the difference in the accounting functional currency resulting from the conversion between different currencies.
4 Principles of foreign exchange business accounting
According to the financial accounting system, foreign exchange business accounting should follow the following Principles:
(1) When an enterprise incurs foreign currency cash, deposits, foreign currency claims and debts, etc., it should convert the relevant foreign currency amounts into RMB for accounting, and record them together.Register the original currency amount and conversion rate on the account at the time.
(2) When an enterprise converts foreign currency into RMB for accounting, the conversion rate used can be the market exchange rate announced by the People's Bank of China on the day when the business occurs, or The market exchange rate on the first day of the month can be used, and at the end of the accounting period, the market exchange rate at the end of the period will be converted into RMB for adjustment. The difference between the adjusted RMB balance and the original book balance will be treated as exchange gains and losses.
(3) When enterprises and institutions settle foreign exchange with banks, on the one hand, the increase in bank deposits will be recorded according to the amount of RMB paid by the bank to the unit; on the other hand, the increase in bank deposits will be recorded according to the market exchange rate. The calculated amount of RMB is recorded as the decrease in accounts receivable, and the difference between the two is regarded as the exchange profit and loss; when the unit purchases foreign exchange from the bank, on the one hand, the decrease in bank deposits is recorded according to the actual RMB amount paid, and on the other hand, it is converted according to the market exchange rate. The amount of RMB is recorded as the decrease in payables, etc.
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