Multi-Currency Accounting and FX for Global SaaS
Written by Nirmala Murugesan
Curated by Rubric Financial
Last updated
1 / 5
Functional Currency Comes First
- Functional currency is the currency of the primary economic environment in which an entity operates, not simply where it is incorporated.
- Under ASC 830, you assess indicators such as the currency of pricing, cash flows, financing, and expenses to determine each entity's functional currency.
- Many early SaaS parents keep USD as the functional currency even when they invoice some customers in euros or pounds.
- A foreign subsidiary that pays local salaries and collects local revenue often has a functional currency different from the parent.
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About the author
Nirmala MurugesanCA, CPAPartner, Accounting
CA and CPA with 20+ years across U.S. GAAP, IFRS, and cross-border entity accounting. Leads accounting and controllership at StartupCFO: clean close, audit-ready books, and multi-entity structures for venture-backed startups.
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