Viewpoints: Determining a mining entity’s functional currency (Mining)

Understand which factors a mining entity must consider in determining its functional currency under International Financial Reporting Standards (IFRS).

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As mining companies often do business globally and enter into transactions denominated in foreign currencies, a question that often arises is: How do I determine our functional currency under IFRS? As Viewpoints: Applying IFRSs in the Mining Industry: – Functional Currency (April 2011) clearly and concisely explains, this depends on specific facts and circumstances relevant to your entity’s operations.

Prepared by Chartered Professional Accountants of Canada (CPA Canada) and the Prospectors and Developers Association of Canada, this useful resource for junior mining companies includes information on:

  • what functional currency is, and how it differs from presentation currency
  • IAS 21 The Effects of Changes in Foreign Exchange Rates
  • the primary and secondary indicators that influence an entity’s functional currency
  • establishing the functional currency for a Canadian holding company
  • the impact of revenue generation on determining functional currency


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