How are daily currency rates applied?

Several different daily rates can be defined for the same date, for a currency, to convert from the pivot currency to the currency. These rates may apply to different sets of accounts. For example, there may be a number of rates defined to convert from GBP to EUR on 11/04/02, for different account ranges.
Note:  The Use Daily Conversion Rates field, in Currency Codes (CNC), must be set to Yes for a currency before the rates defined in currency daily rates are used.

When a transaction is entered for a currency that requires a daily conversion rate, the system searches for the rate. It uses this rate to convert the amount, unless you override this by entering a rate manually on the transaction.

If you enter a rate manually and tolerance checking applies, the rate you enter is checked to ensure it is within the tolerance set. The difference between the rate you enter and the predefined daily rate must be within the tolerance percentage. This prevents you from entering a wildly inaccurate rate by mistake.

The currency rate search

Note:  A daily rate can be applicable for a range of dates. This is defined in the Effective Date From/Effective Date To fields in Currency Daily Rates (CND).

The following steps are used to search for the appropriate conversion rate to apply:

  • Search for a currency daily rate defined for the transaction date, or within the effective date range, and with an account code that matches those on the transaction.
  • Search for a daily rate defined for the transaction date, or within the effective date range, with an account range that includes the account to which the posting is being made.
  • Search for a daily rate defined for the transaction date, or within the effective date range, with no account range assigned.

If you are using currency rate types:

  • Search for a currency daily rate defined for the transaction date, or within the effective date range, with an account code that matches those on the transaction and a currency rate type. If a rate is not available on the currency rate type, the default currency rate type is used.
  • Search for a daily rate defined for the transaction date, or within the effective date range, with an account range that includes the account to which the posting is being made and a currency rate type. If a rate is not available on the currency rate type, the default currency rate type is used.
  • Search for a daily rate defined for the transaction date, or within the effective date range, with no account range assigned, but an available currency rate type. If a rate is not available on the currency rate type, the default currency rate type is used.
Note:  If all of these search steps fail to find a daily rate, a warning message is displayed, and you are prevented from entering amounts for that currency during Ledger Entry (LEN).