Annual report pursuant to Section 13 and 15(d)

Foreign Currency Translation

v2.4.0.6
Foreign Currency Translation
12 Months Ended
Dec. 31, 2011
Foreign Currency Translation [Abstract]  
FOREIGN CURRENCY TRANSLATION

16.    FOREIGN CURRENCY TRANSLATION

The accumulated other comprehensive income (loss) account in stockholders’ equity of $28,181 and $(23,682) at December 31, 2010 and December 31, 2011, respectively, includes the cumulative foreign currency gains (losses) of $34,248 and $(11,325), respectively, from translating the financial statements of the Company’s international subsidiaries, the change in fair values of the Company’s interest rate swap agreements that are designated as hedges and the change in fair value of the Company’s available-for-sale securities.

In 2010 and 2011, all foreign countries where the Company has operations were deemed non-highly inflationary and the local currency is the same as the functional currency in all of the locations. Thus, any fluctuation in the currency results in a cumulative foreign currency translation adjustment recorded to accumulated other comprehensive income (loss).

On December 31, 2011, the exchange rate for the Brazilian real was 1.87 reais to the U.S. dollar (the exchange rate was 1.67 reais to the U.S. dollar at December 31, 2010). As a result, the effect of translating the December 31, 2011 Brazilian financial statements into U.S. dollars is reflected as a foreign currency translation adjustment to the accumulated other comprehensive income (loss) account as a decrease in stockholders’ equity of $28,000. At December 31, 2011, the total assets of the Company’s Brazilian subsidiaries were U.S. $327,679.

On December 31, 2011, the exchange rate for the Mexican peso was 14.00 pesos to the U.S. dollar (the exchange rate was 12.39 pesos to the U.S. dollar at December 31, 2010). As a result, the effect of translating the December 31, 2011 Mexican financial statements into U.S. dollars is reflected as a foreign currency translation adjustment to the accumulated other comprehensive income (loss) account as a decrease in stockholders’ equity of $11,818. At December 31, 2011, the total assets of the Company’s Mexican subsidiaries were U.S. $121,935.

On December 31, 2011, the exchange rate for the Argentinean peso was 4.31 pesos to the U.S. dollar (the exchange rate was 3.98 pesos to the U.S. dollar at December 31, 2010). As a result, the effect of translating the December 31, 2011 Argentinean financial statements into U.S. dollars is reflected as a foreign currency translation adjustment to the accumulated other comprehensive income (loss) account as a decrease in stockholders’ equity of $4,196. At December 31, 2011, the total assets of the Company’s Argentinean subsidiaries were U.S. $128,524.

On December 31, 2011, the exchange rate for the Chilean peso was 520.70 pesos to the U.S. dollar (the exchange rate was 473.20 pesos to the U.S. dollar at December 31, 2010). As a result, the effect of translating the December 31, 2011 Chilean financial statements into U.S. dollars is reflected as a foreign currency translation adjustment to the accumulated other comprehensive income (loss) account as a decrease in stockholders’ equity of $3,324. At December 31, 2011, the total assets of the Company’s Chilean subsidiaries were U.S. $40,084.

The effect of translating the December 31, 2011 financial statements of the Company’s other international subsidiaries, with local currencies other than the U.S. dollar, is reflected as a foreign currency translation adjustment to the accumulated other comprehensive income (loss) account as an increase in stockholders’ equity of $1,280.

 

During May 2011, the Company’s ownership in its Chilean subsidiary increased from 97.4% to 100% as a result of the Company’s purchase of the noncontrolling interests’ shares of Cinemark Chile. As part of this transaction, the Company recorded the amount of accumulated other comprehensive loss previously allocated to the noncontrolling interest of $485, related to the translation of the Chilean financial statements into U.S. dollars, as an increase to accumulated other comprehensive income (loss) with an offsetting decrease to additional paid-in-capital. See Note 9.