Parallel Currencies in Parallel Ledgers

Use

In Financial Accounting, in addition to the local currency, you can define up to two parallel currencies for your company code.

The second local currency should be the currency of the controlling area. We recommend the Group Currency setting (currency type 30). For customers who migrated from one of the releases of the Business Suite and had already chosen a different setting, it is possible to keep two additional local currencies in Financial Accounting, independently of the controlling area currency.

Features

You can use various different currency types as parallel currencies. You define the currency for a currency type when you define the organizational units.

  • Company Code Currency

    You enter the currency key of the company code currency on the company code. You are required to manage a company code currency in all company codes.

  • Group Currency

    You define the group currency when you define your client.

  • Global Company Currency

    You define the global company currency when you define the company assigned to your company code.

  • Hard Currency

    You define the hard currency when you define the country assigned to your company code.

  • Index-Based Currency

    You define the index-based currency when you define the country to which your company code is assigned.

In General Ledger Accounting, the currencies are linked to the leading ledger: Since the settings of the company code are adopted by the leading ledger, that means your leading ledger is also managed in the same parallel currencies in addition to the local currency.

The following restrictions apply to the parallel currencies:

  • You can use a maximum of three parallel currencies (also the second local currency and third local currency).

  • The second and third currency of the parallel ledgers must be a currency that you use as second or third currency in the respective company code. These currencies are adopted by the leading ledger. You can only specify the parallel local currencies specified in the leading ledger as parallel currencies in the non-leading ledgers. Alternative currencies are not possible.

If you manage your ledgers in parallel currencies, this has the following effects:

  • During posting, the amounts are also saved in the parallel currencies. The amounts are translated automatically, but you can also enter them manually.

  • Transaction figures for the G/L accounts are also updated in the parallel currencies.

  • Exchange rate differences also arise in the parallel currencies.

  • You can also perform a foreign currency valuation in the parallel currencies.

Activities

To run the parallel currencies for all processes and functions in Financial Accounting, in Customizing for Financial Accounting (New), choose Start of the navigation path Financial Accounting Global Settings (New) Next navigation step Ledgers Next navigation step Ledger End of the navigation path.

  • Under Define Settings for Ledgers and Currency Types, define the currency types you want to manage in each ledger and company code (transaction FINSC_LEDGER).

    Note Note

    • You always have to manage the company code currency (currency type 10) as the local currency.

    • You must always manage the currency type of the controlling area as the global currency. You process this currency type using transaction OKKP.

    End of the note.

  • Define currency translation rules (exchange rate type, source currency, and translation date).