Conversion rules for amount and Euro initialization

Amount conversion rule

Amounts can be registered in up to three home currencies. Conversion takes place for each new home currency and the resulting amounts are registered in the home currency amount positions in the database. LN uses the currency rates defined in the CI Rates (tccri7100m000) session to calculate the new home currency amounts.

Amount conversion

A different calculation method is used, dependent on the (new) currency system you define in the CI cluster.

If the currency of the new amount in home currency is already present in the previous home-currency array, the new home amount is always copied from the particular previous home amount. In all other cases, amounts in the home currency are recalculated, even if the transaction currency matches the home currency, or the transaction amount equals zero. The latter, for example, applies to currency and rounding differences. Otherwise, merely copying the transaction amount to the new home amount, could result in the document's transactions being out of balance after a CRI conversion.

Euro initialization

If the conversion basis is an EMU-marked currency (in the Currencies (tcmcs0102m000) session), and the new currency is euro (defined as "Transition Currency" ( LN FP5) or "Euro Currency" (in previous versions) in the Companies (tcemm1170m000) session, the amount in euros is always recalculated using the fixed CRI conversion rate. In the latter case, amount differences may occur between euro amounts in transaction currency and in home currency. This occurs if the euro was used as a transaction currency in the past, against a rate different from the CI conversion rate. The mechanism of using the direct rate in the euro initialization case will minimize the risk that the historic business results are different after euro initialization.

• Single currency system

  In a single currency system, the local home currency and the reference currency are the same. The new local home (or reference) currency amount is calculated from the previous local home currency amount by using the exchange rate of the previous local home currency to the new reference currency.

• Dependent multicurrency system

  First the new reference-currency amount is calculated from the previous local home currency amount by using the exchange rate of the previous local home currency to the new reference currency. Next, the calculated reference-currency amount is converted to the amounts in the other home currencies using the exchange rates between the reference currency and the other home currencies.

• Independent multicurrency system

  The home-currency amounts are registered without being related to another home currency. Currency rates are available between each home currency and the transaction currency. The new local home-currency amount is calculated from the previous local home currency. The new reporting home-currency amounts are calculated directly from the transaction-currency amount using the exchange rate of the transaction currency to the new home currency.

• Standard multicurrency system

  The new local home currency amount is calculated from the previous local home currency amount by using the exchange rate of the previous local home currency to the new local home currency. Depending on the individual reporting home currency’s translation method defined in the CI cluster, amounts in reporting home currency are calculated either from the new local home currency or the transaction currency, using the particular CI conversion rates.

  When Operation Management tables, Integration Transactions (tfgld482), or FAM tables in Financials are converted, reporting amounts and rates are directly translated from the transaction currency.