(t) Transactions in foreign currency:
Transactions and balances
Transactions in currencies other than the functional currency are considered to be in foreign currency and are initially recorded at the exchange rate of the functional currency on the transaction date. Monetary assets and liabilities denominated in foreign currencies are converted using the exchange rate of the functional currency as of the date of the Statement of Financial Position. All differences are recorded as a charge or credit to income.
Assets and liabilities in foreign currencies are shown at their equivalent value in Chilean pesos, calculated using the following exchange rates as of December 31, 2016 and 2017: Ch$670.40 and Ch$615.43 to US$1, Ch$5.74 and Ch$5.46 per JPY1, Ch$707.61 and Ch$739.32 per EUR1.
The gain of MCh$104,875 (MCh$12,405 in 2016) for net foreign exchange income shown in the Consolidated Statement of Comprehensive Income includes recognition of the effects of exchange rates variations on assets and liabilities in foreign currency or indexed to exchange rates, and the result of foreign exchange transactions conducted by the Bank and its subsidiaries.