Free workbook · Excel

Translation reserve workbook

What it is

This free Excel workbook works out the month's movement in the translation reserve for up to five foreign subsidiaries. You enter the opening net assets, the profit and three rates, and it shows how each part of the movement arises, with a check that the result ties. A worked example is filled in.

What’s inside

• Inputs for up to five subsidiaries, in each subsidiary's own currency.
• The movement on opening net assets, on profit, and on capital or dividends, worked out by formula.
• The reserve at the start and at the end of the month.
• A check column that rebuilds the closing net assets and should show 0.
• A worked example: Palmridge Hospitality LLC, September 2026, with a movement of GBP 38,858.

How to use it

1. Enter the opening net assets and the month’s profit in the subsidiarySubsidiaryA company that is controlled by another company, its parent.Open the glossary entry‘s own currency.
2. Enter the three rates: the opening rate (last month’s closing rateClosing rateThe spot exchange rate on the last day of the reporting period, used to translate a foreign subsidiary's assets and liabilities.Open the glossary entry), the closing rate and the average rateAverage rateThe exchange rate for a period, usually the month, used to translate a foreign subsidiary's income and expenses into the group's presentation currency.Open the glossary entry for the month.
3. Add any dividend or new capital with the rate on that date. Leave these blank if there was none.
4. Read the movement and the check. The check column should be 0 for every subsidiary.

Who is it for?

Group accountants who translate foreign subsidiaries and want to see why the translation reserveTranslation reserveThe part of group equity that holds exchange differences from translating a foreign subsidiary into the group's currency.Open the glossary entry moves. It handles up to five subsidiaries in one sheet. Once a group has many subsidiaries and months to carry forward, Finconsol works out the reserve for every subsidiary when the rates are loaded.

Questions

What does the workbook calculate?

For each subsidiary it works out the movement in the translation reserve for the month: the opening net assets at the change between opening and closing rates, plus the profit at the change between the average and closing rates, plus any capital or dividends at the change between the rate on their date and the closing rate.

Which standard does it follow?

IAS 21: assets and liabilities at the closing rate, income and expenses at the average rate, and the difference to a reserve in equity. It does not cover a subsidiary in a hyperinflationary economyHyperinflationary economyAn economy where cumulative inflation over three years is approaching or exceeds 100 percent, among other signs. A subsidiary whose functional currency is that of such an economy restates its figures under IAS 29 before translation.Open the glossary entry.

Why is the profit translated twice?

The profit is put into the income statement at the average rate, but it sits in net assets that are translated at the closing rate. The difference between the two rates on the profit is part of the month’s movement.