Globalization has forced the current world economy to get more interconnected. Businesses from around the whole world have the chance to carry out their businesses in different countries. As businesses expand to new areas they need to comply with the laws and regulations of those countries. When businesses enter new markets they are required to translate their financial documentation into the target language of the area. Translating their financial documents also helps to build trust among customers. The need for financial translations has been in demand not only solemnly for the financial industry but all other industries as well. In fact, financial translation is more important than ever before.
Although there’s an increasing demand for quality financial translation, financial translation is one of the most challenging types of translation because of its complexity. Many translators are lacking in-depth knowledge of financial terms, concepts, or overall expertise. As financial translations require certain skills, it is necessary to know about financial translation best practices. In this post, we will talk about the types of financial documents and best practices to translate them.
Financial Translation Essentials
With an increasing demand for quality financial translations, financial translators work with many different types of financial documents and have to comply with multiple rules and regulations. Here are the main types of financial documents that all translators involved in financial translations need to know:
- Banking – this includes exchange, public and private offerings, disclosures, and commodities.
- Economics – this includes market studies and market analysis, macroeconomics, white papers as well as particular area economics.
- Business and Accountancy – this includes business plans, financial agreements, cash flow statements, and balance sheets.
- Investing – this includes equities and bonds as well as Securities and Exchange Commission reports.
- Insurance – this includes auditor and annual reports, regulatory documents, retirement plans, and other documents that are related to insurance.
- Taxes – this includes tax reports and international Financial Reporting Standards or IFRS documents.
- Real Estate – this includes real estate listings, financial paperwork, loans documents, and income statements.
As we can see, financial translations are versatile. And it goes without saying that this is not the full checklist of financial documents.
Financial Translation Best Practices
As financial translations are so diverse, professionals with more niche-specific expertise and experience are the ones who deliver excellent translations. That is why, to obtain the best financial translation services, you should follow the financial translation best practices. Let’s talk about what financial sector translators need to know to give you the best financial translation possible.
1. Financial Translation Special Terms and Knowledge
With so much innovation in the financial system in the past 30 years and more companies going global, there are new changes in the financial markets across the globe every day. This brings to the point that financial translators need to keep up with these changes to provide correct financial translations. It is important as financial translation mistakes not only ruin the credibility of the company but can also result in legal issues.
For successful financial translation, it is important for financial translators to know and be open with the clients about what types of financial documents they can translate. Translators should also be aware of the specific rules about formatting and filing financial records. Financial translators need to have in-depth knowledge of the financial jargon as some words may seem the same to most people but have entirely different meanings in the world of finance. It is also a good idea to choose a specific niche as general knowledge doesn’t help when having to handle specific financial terms.
2. Interest in the Industry is Crucial
The financial industry is wide and diverse. As it comes with hardships if a translator doesn’t have an interest in the industry they won’t be able to succeed. It is also a good idea for translators in this industry to study economics or any other related field so that they have the necessary background and knowledge. Without the necessary background knowledge, the translators will have a hard time understanding the source document that comes with a complicated language and terms specific to the financial field.
3. Constantly updating your Financial Glossary
As we already discussed, the financial industry changes with technology development and innovations. This means that new financial instruments and concepts are presented very frequently. New tools and innovations bring with them new terminology along with a few buzzwords to add to an already dense library of technical terms and expressions. Financial translators should try to stay on top of the latest trends and learn everything they can about the latest technology in their field.
4. Keeping Ultimate Confidentiality
Confidentiality is essential for translators in this field. It helps to maintain an outstanding reputation in the industry. When it comes to financial translation, language professionals frequently work with sensitive data, such as details regarding items that have yet to be released in the local market or financial information about clients. If translators slip any confidential information the company might end up losing huge amounts of resources or money. And lack of confidentiality will lead to translators losing all their clients and their reputation.
5. Staying up to date with Industry Regulations
When it comes to financial translations there’s no room for errors or mistakes in financial documents especially when it comes to regulations. Financial translations must be precise. Many details in financial papers, such as number formats, might change the entire meaning of the translation. For example, commas are used as decimal separators in most European countries, while in locations like Switzerland and Liechtenstein, the point is used as the decimal separator and an apostrophe is used to separate the thousands. To avoid disaster a thorough understanding of the local financial climate is essential for financial translators.
Financial translations are one of the crucial aspects of today’s business when businesses go global. For successful financial translations, companies and financial translation service providers should follow the financial translation best practices.
Verbika’s translation team is an expert in dealing with financial documentation and working with banking and the insurance industry.
If you are looking to get top-quality financial translation services for your company’s financial statements, annual reports, audit reports, or merger and acquisition (M&A) documentation, just contact us!