Translation Methods (SAP ƒ‰ƒCƒuƒ‰ƒŠ

Translation Methods

Definition

Definition with which an account group or item group is translated from the local currency (or transaction currency) to the group currency.

Use

You have to define translation methods in order to complete a currency translation.

For your various account groups or item groups, you can define various translation methods, such as spot exchange rate for asset accounts.

To define exchange rate types, in Financial Accounting Customizing choose Special Purpose Ledger ® Periodic Processing ® Currency Translation ® Set Up Exchange Rate Types.

Structure

In a translation method, you define the following:

Whether documents are to be updated during the currency translation

Which accounts are to be combined in an account group (or an item set)

Whether the translation is only allowed for certain transaction types

With which exchange rate indicator the account group is to be translated (such as spot rate, average rate, historical exchange rate)

With which currency translation key the account group is to be translated, that is, which method for determining the exchange rate is to be used (historical or spot exchange rates)

Using the translation type, you can also define whether you want to translate the local currency or the transaction currency to the group currency.

To which accounts the debit and credit translation differences are to be posted

Integration

You can also use translation methods in Consolidation. Under Use, you should thus specify in which application component the translation method is to be used.