4. Translation Exposure Subsidiary managers should not be held responsible for translation effects, but we don’t think that Xerox discounts the boosted financial results for unit performance measurement if the currency goes in a favorable direction for the foreign operation is a good way of evaluating the performance of subsidiaries. We suggest Xerox compare budgets and actual results using the same metric and isolate inflation-related effects through variance analysis. It can avoid unfair rewards or penalties and it is an easier method to understand and carry out than their current practice.