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Are companies using bid or ask FX rates for financial reporting?

I was asked to established the foreign exchange rates for financial reporting for our company but am not sure if I should be using bid or ask price or whether I should include some interbank %.  I am using Oanda and the average rate calculator as well as the regular currency converter for month end.  Thank you!

Answers

Topic Expert
David OBrien
Title: Treasury Consultant
Company: EE Treasury
(Treasury Consultant, EE Treasury) |

Dear Finance Director:

As you are aware, the rate setting alternatives are:
**Balance Sheet…last day of the month
P&L, there are three options
**Last day of the month
(Easiest to manage
Congruent with Balance Sheet)
**An average rate of the daily spot rates
**Actual spot rate at which the P&L transactions are realized

Most of my clients use the currency mid-rate.

David

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