Activating Exchange Rate Difference Handling for Deferred Tax 
Exchange rate difference handling for deferred tax can be activated at any time, but once it is activated and transactions have been processed, then it cannot be disabled. It is not activated by default for either an existing or a new company.
Note
This function is only available for the following countries where deferred tax is supported: Costa Rica, France, Guatemala, Italy, Mexico, South Africa, and Spain.
Prerequisites
The deferred tax method is set up as follows:
In
Administration 
System Initialization Company Details Accounting Data 
you have determined whether to manage a deferred tax system for customers,
vendors, or both.In
Business Partners Business Partner Master Data Accounting Tax you have defined whether to include each business partner in the deferred
tax system.Since the reporting according to the deferred tax method is done by using special G/L accounts, in
Administration Setup Financials Tax Define
Tax Codes , you have set up each tax code you want to include in the deferred tax system, and in a deferred tax account.
Procedure
From the SAP Business One Main Menu, choose
Administration System Initialization Company Details Accounting Data tab.Select the Apply Exchange Rate on Deferred Tax checkbox.
Result
A new G/L account, Realized Exchange Diff. Gain/Loss on Deferred Tax, is added at company level. Exchange rate differences in marketing documents where deferred tax is applied are posted to this G/L account.
To see the newly-added account, from the SAP Business One Main Menu, choose Administration Setup Financials G/L Account Determination
.
More Information
Deferred Tax and Exchange Rate Differences: Costa Rica, France,