Exchange Rate Adjustment
Due to the constant fluctuations in exchange rates, it becomes necessary to periodically adjust the additional currency. Otherwise, the amounts converted from foreign (or additional) currencies and posted to the General Ledger in local currency may not be accurate. In addition, daily operations posted before the daily exchange rate was entered into the program should be updated after the exchange rate information has been entered.
The Adjust Exchange Rate batch job is used to adjust the currency rates of posted operations for customers, vendors, and bank accounts. It is also possible to adjust the amounts in the additional reporting currency in G/L entries.
Impact on customers and vendors
For customer and vendor invoices, the batch job adjusts the exchange rate difference using the exchange rate at the posting date specified in the batch job. The batch job calculates the difference for the individual currency balances and displays the amounts on the G/L account specified in Unrealized Gains Acc. or Unrealized Losses Acc. on the Currencies page. Balancing operations are automatically posted to customer/vendor accounts in the general ledger.
The batch job processes all open customer and vendor ledger entries. In case of currency fluctuations leading to adjustment, the batch job creates a new customer or vendor ledger detail entry that reflects the adjusted amount for the customer or vendor ledger entry.
Dimensions in Customer and Vendor Ledger Entry
Adjustment entries are assigned data from customer or vendor ledger entries, and changes made are displayed by dimension values.
Impact on bank accounts
For bank accounts, the batch job adjusts the exchange rate difference using the exchange rate at the posting date specified in the batch job. The batch job calculates the difference for each bank account that has a currency code and displays the amounts on the G/L account specified in the Realized Gains Acc. or in the Realized Loss Acc. fields on the Currencies page. Balancing operations are automatically posted to the bank accounts of the General Ledger specified in the posting groups of bank accounts. Batch job calculates one currency operation for each account group.
Dimensions in bank account entries
Adjustment entries for the G/L account of the bank account and profit/loss accounts are assigned with standard bank account dimensions.
Impact on G/L accounts
If posting is carried out in an additional reporting currency, using a batch job, you can create new G/L entries to adjust the rates between the local and additional reporting currencies. The batch job calculates the differences for each ledger entry and adjusts them based on the contents of the Exchange Rate Adjustment field for each G/L account.
Dimensions in G/L account entries
Adjustment entries are assigned with standard dimensions from accounts they are reflected on.
Checking the settings that affect posting of entries when executing an Adjust Currency Rates batch job:
- Currency settings. For details on setting up currencies, see the Currencies page.
- General Ledger Setup. On the Currency Adjustment FastTab of the General Ledger Setup page, there are the following settings that affect posting of entries when performing exchange rate adjustments:
- Currency Adjmt with Correction – if this setting is enabled, exchange rate adjustment entries will be recorded in G/L entries with negative reversal method,- Summarize Gains/Losses – if this setting is enabled, the summarizing result of gain or loss when calculating unrealized exchange rate differences will be published,
- Adjust Currency Exchange Rate in Prepayments – if this setting is enabled, the Adjust Exchange Rate periodic job will revalue operations with the Payment type.
Running an Adjust Exchange Rate batch job
To run an Adjust Exchange Rate batch job:
- Choose the
icon, enter Adjust Exchange Rate, and then choose the related link or using the function Process > Adjust Exchange Rate on the Currencies page. - Fill out the following fields in the window that opens:
| Field | Description |
|---|---|
| Starting Date | Specifies the start date for locating and adjusting entries. The field can be blank so that all entries are adjusted. |
| Ending Date | Specifies the end date to use for locating and adjusting entries. |
| Posting Description | Specifies text for the general ledger entries that are created by the batch job. By default, text is "Exchange Rate Adjmt. of %1 %2", where %1 - currency code, %2 - currency amount that is adjusted. |
| Posting Date | Specifies the date on which the adjustment entries are posted. This date is usually the same as the Ending Date in a batch job. |
| Document No. | Specifies the document number that appears on the general ledger entries that are created by the batch job. |
| Adjust G/L Accounts for Add.-Reporting Currency | Enable this option if you need to perform adjustment in an additional reporting currency |
| Adjust Bank Accounts | Specifies if you want to adjust bank account for currency fluctuation. |
| Adjust Customers | Specifies if you want to adjust customer for currency fluctuation. |
| Adjust Vendor | Specifies if you want to adjust vendor for currency fluctuation. |
| Preview mode | Allows you to review entries that are created by the batch job before posting. |
| Dimensions for Positive | Specifies the dimension for gain entries due to currency fluctuation. |
| Dimensions for Negative | Specifies the dimension for loss entries due to currency fluctuation. |
Below in the batch job are the filters that can be used to limit the effect of the batch job.
To view entries published by the Adjust Exchange Rate batch job:
- Choose the icon, enter General Ledger Entries, and then choose the related link.
- All G/L Entries will open. Click the
icon that opens the filter pane and select the Document No filter. Enter the document number value that was specified when running the batch job in the Document No field.