European Monetary Union: Euro (CA-EUR) (SAP Library - European Monetary Union: Euro (CA-EUR))

European Monetary Union: Euro (CA-EUR)

This is a preliminary version of the documentation for the currency changeover to the euro. It will continue to be updated up until the introduction of the euro on January 1, 1999. You will find the final version in SAPNet.

Purpose

You need this component to be able to carry out transition to the euro in your R/3 System. You use it to cover legal requirements, to be able to carry out business transactions more easily in the dual currency phase and to carry out the local currency changeover.

Integration

Due to dependencies between the various R/3 components, you can only change over the financial and management information systems centrally and not locally in the individual departments. You can change over individual areas gradually and independently of the local currency. Examples include prices, customer and vendor master records, or wages and salaries.

Features

The component offers you

Functions for covering previously known legal requirements (exchange rate translation)
Additional euro functions for processing business transactions more easily during the dual currency phase
A changeover package for the local currency changeover.

Functions for Meeting Legal Requirements

You will need statutory foreign currency translation rules and rounding rules (Preparation Directive based on Article 235 of the Maastricht Treaty) at the beginning of the dual currency phase.

The R/3 System fulfills the required foreign currency translation rules as follows:

You can enter the exchange rates which the Council defines for the euro in the R/3 System, expressed in the individual national currencies of the participating member states (such as one euro = DEM 1.94352).
The R/3 System also uses the specified exchange rates for translations between the various national currency units, that is there are no longer any currency cross-rates between the individual currencies. When translating a national currency amount into another currency, the amount is first translated to the euro and then into the other national currency unit.
Exchange rates are neither rounded nor shortened by one or more places.
No inverted exchange rates are used for translation, that is amounts in national currency units are always divided by the exchange rate when translating to the euro.
The exchange rates have six significant figures. This way translations have a high degree of accuracy.

The R/3 System fulfills the required rounding rules as follows:

Amounts which are translated from one national currency unit into another one are first translated to the euro and then into the other national currency unit.
When translating to the interim result in euro, the system rounds to a minimum of three decimal places.

Business and Technical Functions

Multicurrency capability at the beginning of the dual currency phase

The R/3 System distinguishes between the transaction currency (entry currency) and the local currency (ledger currency). The transaction currency is the currency in which a transaction, such as posting an incoming invoice, is entered. The amount entered in transaction currency is then translated into the local currency and both amounts are stored in the document. This means you can always make reference to the business partner’s currency when sending correspondence such as payment reminders. You can therefore enter business transactions in national currency in the R/3 System even after the changeover to the euro. This corresponds to a foreign currency transaction with the only difference being that the euro has fixed exchange rates. Before changing over the ledger currency to the euro, the euro is managed as a foreign currency. Between the changeover and the end of the dual currency phase, the national currency will appear as a foreign currency.

Additional functions for improved and easier processing of business transactions during the dual currency phase, such as retroactive accounting functions in national currencies for the period after the local currency changeover (see Additional Euro Functions (CA-EUR-GEN)

Programs for Local Currency Changeover

Retroactive accounting functions in national currencies for the period after the local currency changeover.