Generally accepted accounting principles (GAAP) do not allow businesses to report exclusively in constant currency. However, many businesses will provide constant currency metrics alongside their GAAP financial statements.
Advantages of constant currency reporting
Comparability is the primary advantage of constant currency reporting. Stripping away the exchange rate effect allows for more meaningful, reliable comparisons between periods.
A net income increase of 50% on a constant currency basis, for example, is usually a positive result. On the other hand, 50% net income growth based on unadjusted numbers with no clarification of the currency effect is less definitive.
Advocates of constant currency reporting also argue that exchange rates are outside the control of business leaders, so results that exclude currency fluctuations provide more transparency into underlying business performance.