IAS 21 — The Effects of Changes in Foreign Exchange Rates
Implementing "Weighted Average" FX calculations is permitted under IAS 21 and is a better reflection of the actual rate compared with using the "Simple Average". This example shows the implementation of "Weighted Average " calculations and the financial impact of "Weighted Average" over " Simple Average".
At each subsequent balance sheet date: [IAS 21.23]
foreign currency monetary amounts should be reported using the closing rate non-monetary items carried at historical cost should be reported using the exchange rate at the date of the transaction non-monetary items carried at fair value should be reported at the rate that existed when the fair values were determined