How is FX on cash balances presented on the cash flow statement? We have some bank accounts that are in a currency that is different from our functional currency.
FX on cash
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If you hold cash in a different currency than your functional currency, you would have gains or losses on remeasurement to your functional currency that would be recorded in the income statement. These gains/losses are not cash flows and should be included in a separate line item as part of the reconciliation of the change in cash and cash equivalents during the period (typically called “Effect of exchange rate changes on cash and cash equivalents.”)