Office Depot 2011 Annual Report Download - page 216

Significant intercompany balances and transactions have been eliminated in the accompanying consolidated financial
statements.
Foreign operations which operate in a non-inflationary environment and whose functional currency is the same as the
currency in which transactions are recorded translate their financial statements using the following exchange rates: 1) the
closing exchange rate in effect at the balance sheet date for assets and liabilities; 2) historical exchange rates for
stockholders’ equity, and 3) the rate on the date of accrual of revenues, costs and expenses. Translation effects are recorded
in stockholders’ equity.
Foreign operations which operate in an inflationary environment and whose functional currency is the same as the currency
in which transactions are recorded, first restate their financial statements in currency of purchasing power as of the date of
the balance sheet, using the price index of the country of origin of the functional currency, and subsequently translate those
amounts to Mexican pesos using the closing exchange rate in effect at the balance sheet date for all items. Translation
effects are recorded in stockholders’ equity.
8
Company Equity Activity
Indirect subsidiaries:
Centro de A
p
o
y
o Caribe S. A. de C. V. 90.00%
The acquisition and leasing of all types
of real estate. This company has not
initiated operations as of the date of
these consolidated financial
statements (subsidiary of Centro de
Apoyo, S. A. de C. V.), located in
Mexico.
OD Colombia, S. A. S. 98.02%
Stores specializing in the sale of services
and office supplies (subsidiary of
ODG. Caribe, S. A. de C. V.), located
in Colombia.
Pa
p
elera General, S. A. de C. V. 99.99%
The distribution of office supplies
(subsidiary of Formas Eficientes, S.
A. de C. V.), located in México.
Ofix
p
res, S. A. S. 100%
The distribution and handling of office
supplies inventories as well as
fabrication of printed forms, located
in Colombia, (subsidiary of OD
Colombia, S. A. S.).
e. Translation of financial statements of foreign subsidiaries
—
To consolidate financial statements of foreign subsidiaries,
the accounting policies of the foreign entity are converted to MFRS using the currency in which transactions are recorded
except for the application of NIF B-10, Effects of Inflation, when the foreign entity operates in an inflationary environment,
since this NIF applies to financial statements that have been remeasured to the functional currency. The financial
statements are subse
q
uentl
y
translated to Mexican
p
esos considerin
g
the followin
g
methodolo
g
ies: