(b) Translation adjustments result from translating an
entity’s financial statements into the reporting currency. Such
adjustments, which result when the entity’s functional currency is
the foreign currency, should not be included in net income.
Instead, such adjustments should be reported as other comprehensive
income and accumulated other comprehensive income
in the stockholders’ equity section of the balance sheet. If the
functional currency is the reporting currency (US dollar), a
remeasurement process takes place, with the resulting gain or
loss included in net income.