Posting Exchange Differences from Reconciliation Manager

If the Generate Difference option is set for a Reconciliation Profile, Reconciliation Manager will generate and post realized exchange gain or loss transactions, where necessary. For example, if the transaction currency values match on the reconciled transactions but the base currency values do not match.

The balancing currency is chosen in the Amount to be Used field on the Reconciliation Profile. For example, if Use Transaction Currency is chosen here the transaction currency amounts must balance and the system will generate gain or loss transactions to balance the base currency amounts, if necessary.

Two exchange gain or loss transactions are posted. One is posted to the realized gain or loss account that is nominated for the Reconciliation Account and the other is posted to the source transaction account.

Exchange Difference Transaction Analysis

The transaction analysis codes that are set on the exchange difference transactions are determined in different ways depending on:

  • how the transactions are reconciled - manually or automatically
  • whether single or multiple debit and credit transactions are being matched.

Manual Reconciliation

If you are using Reconciliation Manager to manually match single debit and credit transactions on a single account and an exchange difference posting is required, the analysis codes for both of the exchange difference transactions are taken from the transaction in the matched pair that has the lowest amount in base value.

If you are using Reconciliation Manager to manually match multiple debits and credits on a single account, the Manual Ledger Alloc - Analysis Codes form is displayed. This allows you to enter the analysis codes required for the exchange difference transactions posting to the source account and exchange gain/loss account. The analysis codes available for input on this form are determined by Chart of Accounts (COA) and Ledger Setup (LES).

Automatic Reconciliation

If you are using the Auto-Reconcile facility, Reconciliation Manager must be able to automatically determine the analysis codes that should be used on any exchange difference transactions required.

The system derives a set of default analysis codes from the reconciled transactions. These default codes are derived in different ways depending on how many transactions are being reconciled and the Consolidate Amounts setting for the Reconciliation Profile, as follows:

  • If you are using Reconciliation Manager to automatically match single debit and credit transactions on a single account and the Consolidate Amounts flag is not selected on the Reconciliation Profile, the default analysis codes for both of the exchange difference transactions are taken from the transaction in the matched pair that has the lowest amount in base value.
  • If you are using Reconciliation Manager to match multiple debits and credits on a single account and the Consolidate Amounts flag is not set, you are prompted to enter the analysis on the gain/loss and source accounts.
  • If you are using Reconciliation Manager to automatically match multiple debits and credits on a single account and the Consolidate Amounts flag is set, the reconciled debit and credit transactions are consolidated. The default analysis codes are taken from the group of debit or credit transactions with the lowest consolidated value. The default analysis codes are copied from the transaction in this group that contains the largest value.

Once it has determined the default analysis codes it applies any analysis code overrides that have been defined on the Reconciliation Profile. You can override the default codes separately for the two exchange difference postings, to the source account and to the gain or loss account.

Note:  You can only define these analysis code overrides if the Exchange Difference per match option is set on the profile. If the Exchange Differences per match option is not set, all gains and losses are consolidated and the balance posted to the gain/loss and source accounts.