Currency differences

When currency differences are posted, several parameters affect the way the entries in the General Ledger are created. This section explains the possible parameter settings:

  • Ledger accounts by currency.
  • Writing off currency profits.
  • Fixed exchange rate.
  • Writing off currency differences for anticipated payments.

Ledger accounts by currency

This parameter is recorded in the Finance Company Parameters (tfgld0503m000) session.

If the Ledger Accounts Currency Differences by Currency check box is selected, the (un)realized currency differences are posted to the ledger accounts defined in the Currency Difference Ledger Accounts by Currency (tfgld0119s000) session.

LN retrieves the related dimensions from these sessions:

  • General Ledger: Finance Company Parameters (tfgld0503m000)
  • Accounts Payable: Ledger Accounts by Business Partner Group (tfacp0111m000)
  • ACR: Ledger Accounts by Business Partner Group (tfacr0111m000)

If the Ledger Accounts Currency Differences by Currency check box is cleared, the currency differences are posted to:

  • General Ledger: the ledger accounts specified in the Finance Company Parameters (tfgld0503m000) session.
  • Accounts Payable/ Accounts Receivable: the ledger accounts recorded for the business partner group.

Writing off currency profits

This parameter is defined in one of these sessions:

  • ACP Parameters (tfacp0100m000)
  • ACR Parameters (tfacr0100s000)

If the Currency Profits check box is selected, the unrealized currency profits are posted as well as the unrealized currency losses. Unrealized currency losses are always posted when writing off currency differences.

Fixed exchange rates

For each invoice, the rate determiner defines:

  • Which date is used to determine the exchange rate.
  • If currency differences are calculated.
  • For which (home) currencies the currency differences are calculated.

The Rate Determiner is set in the Sales Invoices (tfacr1110s000) session or the Purchase Invoice Entry (tfacp2600m000) session.

Unrealized currency differences are written off in one of these sessions:

  • Write Off Currency Differences (tfacp2240m000)
  • Write Off Currency Differences (tfacr2250m000)

Writing off currency differences for anticipated payments

This parameter is defined in one of these sessions:

  • ACP Parameters (tfacp0100m000)
  • ACR Parameters (tfacr0100s000)

If the Currency Difference Anticipated Payments check box is selected, invoices with anticipated payments or anticipated receipts are considered for writing off currency differences.

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