Entities which generate a profit usually are part of the profits paid to their shareholders.
Their shareholders that had having made a decision regarding the payment of a dividend,
a subsidiary must to pay dividends to their parent company. If a subsidiary pays dividends
in a currency rather than the functional currency of a foreign subsidiary (currency such
as used by the parent company) and at the accrual and payment dates are different, as well
as exchange rate changes, then the exchange rate differences are arising. At the parent
company, the situation is opposite. If the subsidiaries pay dividends in the functional
currency, while the parent company uses a different currency, and thus the date
of calculation and payment are different, as well as exchange rate changes, the exchange
rate differences are in the parent company. The problem of accounting data exchange
differences on consolidation of financial statements is very relevant today.