foreign currency transactions
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The effect of derivatives and hedging activities on other comprehensive income. The effect of foreign currency translation on other comprehensive income.
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The effect of derivatives and hedging activities on other comprehensive income. The effect of foreign currency translation on other comprehensive income.
The hedging activity is a position taken up to offset potential losses that may occur because of a business related companion investment. In case of foreign currency, the trader enters into a transaction to protect and existing or anticipated position from unwanted changes in the foreign currency rates. The objective of hedging is to protect the firm from risk of loss. So, the effect of hedging activity on other comprehensive income is twofold. First, the cost of the hedge reduces the comprehension income. Second, the other comprehensive income is ...
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