I was asked to established the foreign exchange rates for financial reporting for our company but am not sure if I should be using bid or ask price or whether I should include some interbank %. I am using Oanda and the average rate calculator as well as the regular currency converter for month end. Thank you!
Are companies using bid or ask FX rates for financial reporting?
Answers
Dear
As you are aware, the rate setting alternatives are:
**Balance Sheet…last day of the month
P&L, there are three options
**Last day of the month
(Easiest to manage
Congruent with Balance Sheet)
**An average rate of the daily spot rates
**Actual spot rate at which the P&L transactions are realized
Most of my clients use the currency mid-rate.
David
Filed Under:
Cash Management