Temporal method requires that all assets and liabilities are translated at the exchange rate at the time the asset or liability was incurred. Only monetary assets and liabilities are translated using the current rate.
Monetary: Current rate Non-Monetary: Historical rate Common Stock/Dividends: Historical rate COGS/depr/ammort: Historical rate All other revenues: Average rate Remeasurement gains/losses go onto the income statement
All Assets/liabilities: Current rate Common Stock/Dividends: Historical rate Revenues/Expenses: Average rate Gains and losses are on the "CTA" account - a plug figure on the balance sheet
Bottom Line:The difference between the two methods has to do with non-monetary assets and COGS/depr/ammortization. All other things are the same. These two things are translated at the historical rate in the temporal method.