Examples: Local Currency Change

Inversion of an Entry in Local Currency Posted in the Prior Year

This example illustrates the approach the system takes when data records of the previous year are inverted and, thus, need to be translated ad hoc.

The original entry was posted in the local currency GBP in 2003 (step 1).

In the year 2004 a consolidation function needs to invert the data record (step 2) and translate it into the new local currency ad hoc (step 3).

Afterwards, the system also processes the values in transaction currency (step 4): The value for item “A” remains unchanged because item “A” has a breakdown by transaction currency. However, the old value of item “B” is translated into the new local currency because the item does not have a breakdown by transaction currency and was posted with posting level 10.

Ad Hoc Translation

Year	Cons Unit	LC Key of Cons Unit	Item	TC Key	TC Value	LC Key	LC Value	GC Key	GC Value
1. Original data records
2003	C1000	GBP	A	GBP	100	GBP	100	USD	300
			B	GBP	-100	GBP	-100	USD	-300
2. Result of an inverting consolidation function (executed in the current year)
2004	C1000	GBP	A	GBP	-100	GBP	-100	USD	-300
			B	GBP	100	GBP	100	USD	300
3. Ad hoc translation
2004	C1000	GBP	A	GBP	-100	EUR	-270	USD	-300
			B	GBP	100	EUR	270	USD	300
4. Postprocessing to adjust data records for items without a breakdown by transaction currency
2004	C1000	GBP	A	GBP	-100	EUR	-270	USD	-300
			B	EUR	270	EUR	270	USD	300

Posting of a Rounding Difference

This example shows how a rounding difference can be incurred due to a local currency change, and how this difference is posted to a differential item.

Rounding Difference

Item	LC Value 2003	Exchange Rate	LC Value 2004
11112000	0.30	1/32.5	0.01
11411000	-0.15	1/32.5	0.00
11412000	-0.15	1/32.5	0.00
25714000 (Rounding Differences)			-0.01
Total	0.00		0.00