Selecting the Revaluation Source and Target Currencies

Ledger Revaluation revalues a selected currency (the target currency) against another currency (the source currency) on a group of transactions. It revalues the selected source currency value on each transaction, using the revaluation period exchange rate, to determine the revised value in the target currency. The difference between the original and revised target currency values is the revaluation difference.

You must specify the source and target currencies in a revaluation profile, using Ledger Revaluation Profiles (LEP).

The currencies you can choose as the source and target currencies for a revaluation profile depend on your revaluation requirements, and on your pivot currency. This in turn determines the content of any revaluation postings generated.

Note: You must choose the pivot currency as either the source or target currency.

Selecting the Source Currency

The revaluation source currency can be any one of Value 1, 2, 3 or 4; that is, base currency, transaction currency, second base/reporting currency, or fourth currency.

This currency value on each transaction is used as the basis of the revaluation. These values are not updated, which means that the revaluation postings never adjust the source value.

Selecting the Target Currency

The target currency can be Value 1, 3 or 4; that is, base currency, second base/reporting currency or fourth currency. For example, you might want to revalue the base currency amounts based on the updated transaction currency exchange rates, to determine the gain or loss in the base currency.

You cannot select Value 2 as the target of your revaluation, as revaluations are not possible in the transaction currency (Value 2). This is because the transaction currency values are assumed to be 'real' rather than calculated values, and therefore should not be changed. For example, they might be foreign currency values on an invoice received from a supplier, which must always remain at the exact amount printed on the invoice. You might, however, revalue one of the other currency values in order to register the gain or loss following any exchange rate movement against the currency on the invoice.

The Revaluation Source and Target Currency Combinations

The combinations of currencies you can select to revalue depend on the currency options that are set in Business Unit Setup. You cannot use the same currency value for both the source and target revaluation currencies; also, as described above, Value 2 cannot be revalued. The following table shows whether each combination of source and target currencies is valid for revaluation, and how the valid combinations depend on the options set in Business Unit Setup:

	Target Currency to be Revalued
Source Currency	Value 1
Value 1	No
Value 2	Yes - Pivot must be Value 1 or Value 2.
Value 3	Yes - Pivot must be Value 1 or Value 3.
Value 4	Yes - Value 4 must be calculated from Value 1

Note: If you revalue the fourth currency (Value 4) based on the transaction currency (Value 2), and the Revalue until True Rated option is set on Ledger Setup (LES), then transactions marked as true rated are not revalued.

The source and target combination you choose, and the pivot currency, determine the type of revaluation postings generated.

Note: Revaluing the transaction or fourth currency against either base or second base/reporting currencies generates revaluation, unrealized gain or loss adjustment postings. Revaluing between base and second base/reporting currencies generates a revaluation balancing adjustment postings, and this is not possible if the transaction currency is the pivot.