Accounting for FX

[swong1709]

Hi All,

Just want to ask for a bit more explanation on the below:

Same functional currency as reporting entity:
- Immediate impact on reporting entity's CF from foreign operations (affect monetary items but not net investment in the operation)

Different functional currency as reporting entity:
- Little or no direct impact on CF from foreign operations (affect net investment in the operation)

Why does it have no impact on CF? What do they mean by net investment?

Thanks,