Example: Execution of a Currency Translation (SAP Library

Example: Execution of a Currency Translation

Purpose

You want to translate the balance sheet and the income statement of a consolidation unit from local currency to group currency.

Prerequisites

The consolidation area contains:

the characteristics with the roles financial statement item and transaction type

Process Flow

A. Customizing

Define exchange rate indicators, translation ratios, exchange rates

Define the exchange rate indicators, translation ratios, and exchange rates for the currency translation.

Define task

Define a task for the currency translation.

Define method layout

Create a new method layout or use an existing one. The method layout must have steps:

Define the method layout as follows:

Definition of the method layout

Define in ...	Selection	Source Key Figures	Currency Translation Key	Exchange Rate Determination	Translation Differences
... the method
Visibility	¯	X			¯
Detail Screen					TType
Fast Entry	Item				Item
... all steps
Visibility			X	X
Detail Screen
Fast Entry

This method layout definition has the following consequences for the definition of the method:

You define the selection in fast entry.
The source key figures are visible and specifiable globally (for the entire method).
You define the currency translation key and the exchange rate type for each step.
The accounting object for the translation difference is defined in fast entry for each step; however, the transaction type is determined globally for all steps in the detail screen Difference.

Define method

Create a method for the method layout.

First, globally define (at the top level) the reference translation for all steps:

Select the group currency as the target key figure.
Select the local currency as the target key figure for the reference translation.
Select 1001 (current exchange rate) as the exchange rate type for the reference translation.

In fast entry, create a step for each combination of currency translation key and exchange rate type.

Fast Entry

Step		Item (Selection)		Item (Translation Difference)	Navigation
Investments	[ ]	170000-170399	=	250900	®
Stockholders’ Equity	[ ]	250000-250899, 290300-290700	=	250900	®
Retained earnings (balance sheet)	=	290200	=	250900	®
Other balance sheet items	[ ]	100000-169999, 170400-249999	=	250900	®
Income statement	[ ]	300000-390000	=	321300	®

In the detail screen Differences, globally select (at the top level) the transaction type 100 (opening balance) for all steps.

For each step, define which currency translation key and exchange rate type are to be used:

Step	Specific translation
Investments	Currency translation key: cumulative Exchange rate type: 1003 (historical rate)
Stockholders’ Equity	Currency translation key: cumulative Exchange rate type: 1001 (current rate)
Retained earnings (balance sheet)	Currency translation key: periodic, average rate for reductions Exchange rate type: 1002 (average rate)
Other balance sheet items	Currency translation key: cumulative Exchange rate type: 1002 (average rate)
Income statement	Currency translation key: periodic, average rate for reductions Exchange rate type: 1002 (average rate)

Save your entries.

Assign method

Assign the currency translation method to the task and the corresponding consolidation units.

B. Starting the Currency Translation

Execute the currency translation by running the task for currency translation in the consolidation monitor.