Currency calculation of the schedule detail
Financial Consolidation differentiates between the currency calculation of the YTD closing value and the individual movement during a certain period.
Each individual movement within a schedule is assigned a certain currency translation, which consists of the currency exchange rate and the basis. The basis indicates whether the currency exchange rate is taken from the current period or the previous period.
Select . In the Rate column, you can select these exchange rates to use for each translation:
- !: Currency setting of an account
- A: YTD average rate
- F: Closing rate
- H: Historical rate
- WA: Weighted average rate
In the Base Period column, you can select these options to use for each translation:
- B: Base period for the closing or historical rates
- C: Closing period
For the opening balance, the account rate (!) and base period (B) are usually used. For movements such as increases, decreases, or depreciation, YTD average rate ( A) or weighted average rate (WA), and the closing period are usually used.
For example, if an account uses the YTD closing rate, the local value is 1,500, and the exchange rate is 1.5, then, by dividing the local value by the exchange rate, the calculated group value is 1,000. This is what is shown in the TFINANC cube.
The TDETAIC cube shows not only the closing value but also the movement during the year, including the opening balance. For example, if an account shows an opening balance of 1,000, an increase of 700 and a depreciation of 200 in the local currency, then the opening balance in the group currency is calculated with the rate of the base period and increase and depreciation are calculated with the YTD average rate of the current year.
The same logic applies to the TSEGMOVC cube, which stores only segment information.
This table shows how the group values are calculated with the base period rate of 1.2 for the opening balance, and, for increase and depreciation, with the YTD average rate of the current year of 1.4:
| Description | Local value | Group value |
|---|---|---|
| Opening balance | 1,000.00 | 1,000/1.2=833.33 |
| Increase | 700.00 | 700/1.4=500.00 |
| Depreciation | -200.00 | -200/1.4=-142.86 |
| Closing balance (sum) | 1,500.00 | 1,190.47 |
The calculated group value is different from the closing balance value. This is because individual movements must be calculated differently than the closing balance. To receive the correct value for the closing balance, you must include a currency translation difference.
This table shows how the closing balance is calculated in the group currency with a currency translation difference:
| Description | Local value | Group value |
|---|---|---|
| Closing balance before currency adjustment | 1,500.00 | 1,190.47 |
| Currency translation difference | 0.00 | 190.47 |
| Closing balance after currency adjustment | 1,500.00 | 1,190.47-190.47=1,000.00 |