Advanced Accounting Week 5 Discussion

Although the main functional currency for the Walmart Corporation is the U.S. dollar,
some of its subsidiaries use other currencies. Hence, when calculating operating results, Walmart
uses currency exchange rates to convert operating results for countries that do not use the U.S.
dollar as a functional currency as well as those countries that are currently experiencing
hyperinflation. The effect of currency exchange rates from the previous period to the current
period is computed as the difference between activities in the present period based on the
exchange rates of the current period, and activity of the current period based on comparable
exchange rates of the prior-year period.
Therefore, Walmart converts the currency of the country within which a subsidiary is
operating into the American currency (Wal-Mart, 2019). The company accounts for the
computation and currency exchange rate fluctuation. The constant currency operating results are
for the functional outcomes without any influence of the currency exchange rate. Disclosure of
the currency amount allows investors to have a better understanding of the performance of
Walmart.
Nevertheless, the company does not accept foreign currency. It has transfer services that
permit users and consumers to use local currency while sending transfers worldwide. Some
international Walmart subsidiaries might offer more services, such as accepting the USD in
addition to other local currency. Such affiliates may permit transfers between various currencies.
Be that as it may, Walmart must convert money into the U.S. currency in all dealings with firms
and subsidiaries.

ADVANCED ACCOUNTING WEEK 5 DISCUSSION 3

References
Wal-Mart (2019). 2018 SEC 10k Report. 2019, Retrieved from
https://www.sec.gov/Archives/edgar/data/104169/000010416918000028/wmtform10-
kx1312018.htm