Euro Currency Overview

This topic describes how the system handles the Euro currency. It does not attempt to describe the details of the Euro currency system or any related rules and regulations.

For Euro-participating countries, there may be an interim period during which the country is converting their national currency to the Euro currency. During this interim period, financial transactions between participating countries can be completed in either the Euro currency or the national currency.

If you are a Euro participant, the system performs the necessary currency conversions when you conduct transactions with other Euro-participating countries during the interim period. When you change your domestic currency to the Euro, you can use the system utilities to convert all of your relevant business history. If you are not a Euro participant, but you conduct transactions with Euro-participating countries, the system performs the currency conversions.

Currency Conversion Utilities

When you are ready to switch to the Euro, the Domestic Euro Currency Conversion utility converts your base domestic currency. The utility converts all domestic currency-specific amounts, including history data.

If any of your vendors have switched to the Euro, you can use the Vendor Euro Currency Conversion utility to convert all transaction amounts stored in the vendor's old currency. Similarly, the Customer Euro Currency Conversion utility allows you to convert any customer transaction amounts stored in the customer's old currency.

Asset/Liability Revaluation

All accounts receivable, accounts payable, and vouchers payable records in the system are expressed in the transaction currency of the customer or vendor. These records also contain an exchange rate to translate the values back to your base currency. As of 1/1/1999, the exchange rate between Euro-participating currencies and the Euro currency is fixed.

Therefore, you must revalue outstanding assets and liabilities using the fixed exchange rate. Run the Currency Revaluation Report , the Bank Account Revaluation utility, and the Euro Exchange Rate Revaluation utility.

When to run the Euro Exchange Rate Revaluation utility

If your company is situated in a Euro-participating country, Euro regulations require you to revalue asset and liability transactions using this exchange rate. If you are not situated in a Euro-participating country, this revaluation is optional.

During an interim period of transitioning a national currency to the Euro, Euro regulations prohibit direct currency conversions between Euro-participating countries. Therefore, to convert a monetary amount from one national currency to another, the system performs all conversions between Part of Euro currencies using the Triangulation conversion method. This conversion method may affect the value of asset and liability transactions in your system.

The domestic-to-foreign exchange rate from the time the transaction was created is contained within the transaction record. As of 1/1/1999, the exchange rate between Euro-participating currencies and the Euro currency has been fixed. Therefore, for each currency code set as Part of Euro, you must run this utility to revalue the outstanding asset and liability transactions using the fixed exchange rate.

Customer Payment Processing

The system allows you to accept payments in either the customer's transaction currency, the Euro currency, or your base domestic currency. During the interim period, you can accept payments in the Euro currency without switching your base domestic currency to the Euro. Therefore, you can accept payments in the Euro currency only for those transactions that require it, and deposit the customer payments in a base or Euro bank account.

Reports

The following system reports allow you to print the total monetary amount in both the Euro currency and the transaction currency for any Euro-participating customer or vendor: