Function documentationParallel Currencies in New General Ledger Accounting and New Asset Accounting

 

You can use the General Ledger Accounting function described below, if you do not need valuation parameters (different acquisition and production costs (APC)/alternative depreciation terms) for group consolidation that are different from your local valuation, but only need amounts in a foreign currency.

The Financial Accounting (FI) component enables you to manage all values of one company code, on the same accounts, in additional parallel currencies. To do this, you can define parallel currencies for each company code in Customizing for Financial Accounting.

Make the following specifications for each parallel currency:

  • Currency type, according to the function of the currency (for example, group currency)

  • Exchange rate type for the currency translation

  • Source currency for the currency translation

  • Date (for example document date) for the translation

Also the transactions for acquisition and productions costs (APC) and depreciation that are posted in Asset Accounting can be updated in multiple currencies in Financial Accounting in parallel, and in the same accounting document as the posted amount in the local currency.

Prerequisites

In new Asset Accounting, you have to manage a depreciation area with the following properties for each currency:

  • The currency type and currency of the depreciation area are identical to those of the corresponding parallel currency in the company code in question.

  • The depreciation area has identical depreciation terms and identical acquisition values to the depreciation area that updates values to the G/L accounts.

The system then automatically updates the corresponding posting documents with the additional values from these depreciation areas. The values from the foreign currency depreciation areas are not allowed to be posted explicitly (according to their posting setting) to General Ledger Accounting.

Features

The system translates APC acquisitions into the parallel currency based on the exchange rate type (historical valuation). The system does not translate depreciation amounts at a fixed exchange rate. Instead, depreciation is calculated in the given currency, using the depreciation terms in the depreciation area. This method guarantees that the net book value zero is reached during the defined useful life in all depreciation areas with parallel currencies. The system also does not translate APC retirements and proportional value adjustments at a fixed exchange rate. Instead, the system calculates these values based on the proportional amount of APC being retired in the local currency area.

Caution Caution

It is not possible to begin using the parallel currency functions after the company code is already live. You have to make the described Customizing settings before you go live with the given company code.

End of the caution.
Parallel Currencies with the Ledger Approach

For each currency in General Ledger Accounting, as already mentioned above, you have to create parallel depreciation areas in new Asset Accounting.

For the ledger approach, note that each ledger can only contain a subset of the parallel currencies of the company code.

Depending on whether a depreciation area posts in real time or periodically to new General Ledger Accounting, the system translates the values historically or for a key date:

  • Historical management of values:

    Set up an additional depreciation area for each posting depreciation area and for each accounting principle that manages this parallel currency.

    In Customizing for Asset Accounting (New), choose Start of the navigation path Valuation Next navigation step Depreciation Areas Next navigation step Define Depreciation Areas End of the navigation path.

    Valuation in the parallel currency is entered on the assigned G/L accounts and in Asset Accounting, using the historical currency exchange rates of the original posting (for example, the invoice receipt).

  • Management of values related to a key date (only relevant for the special case where APC is posted periodically for the depreciation area):

    The values of the posting depreciation area are translated into all parallel currencies of the company code for this area on the key date of the periodic document creation for this depreciation area. If General Ledger Accounting manages fewer currencies than the company code, then only the currencies managed in General Ledger Accounting are considered.

Parallel Currencies with the Accounts Approach

If you manage parallel currencies in the company code, you have the following options for managing values:

  • Historical management of values:

    You set up an additional parallel currency depreciation area for the posting depreciation area. In Customizing for Asset Accounting (New), choose Start of the navigation path Valuation Next navigation step Depreciation Areas Next navigation step Define Depreciation Areas End of the navigation path.

    Valuation in the parallel currency is entered on the assigned G/L accounts of General Ledger Accounting and in Asset Accounting, using the historical currency exchange rates of the original posting (for example, the invoice receipt).

  • Management of values related to a key date (only relevant for the special case where APC is posted periodically for the depreciation area):

    The values of the posting depreciation area are translated into the parallel currency for this depreciation area on the key date of the periodic document creation.

More Information

For more information, see the application documentation of new General Ledger Accounting under Parallel Currencies in Parallel Ledgers.