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Author's profile photo Katrin Gruber

Foreign Currency Remeasurement for General Ledger Accounts in SAP Business ByDesign

The objective of this blog post is to explain how to implement and handle the foreign currency remeasurement for General Ledger accounts in SAP Business ByDesign system.

This new functionality plays a major role for companies whose business is subject to significant exchange rate fluctuations.

With this functionality now also balances of general ledger accounts of the types OASSET (Other Assets) and OLIAB (Other Liabilities) can be converted from foreign currencies into the company currency on a specific key date – as it is since ever possible for Receivables, Payables and Cash.

1 Business Configuration Settings

1.1 Activation of the functionality in solution scope

To activate this functionality in workcenter Business Configuration, a Change Project is required. If needed, you can find support in creating change project in the embedded system documentation.

Select the project and click on Edit Project Scope.

Then, in step 4 Questions, select the Scoping Element Financial and Management Accounting > General Ledger > General Ledger > set the flag in the question highlighted in the screenshot below:

1.2 Finetuning-Settings

Open the activity Foreign Currency Remeasurement for General Ledger Accounts.

If you do not want to use the pre-delivered foreign currency remeasurement methods, you can also create your own ones under Edit foreign currency remeasurement methods.

Under Assign remeasurement method to accounting principle you need to assign the methods to the corresponding accounting principles:

1.3 Account Determination

In account determination one account must be entered for the Gain and for the Loss from Foreign Currency Remeasurement:

 

2 Other Settings

2.1 Adaptation of user access rights

For the new Foreign Currency Remeasurement Run a new Periodic Tasks has been created, to which the user access rights must be assigned in Application and User Management workcenter:

2.2 Maintenance of exchange rates

In workcenter General Ledger > Common Tasks > Edit Exchange Rates the exchange rates on key date must be entered for all currencies, which should be considered by the remeasurement run.

Alternatively, the exchange rates can also be imported.

If needed, you can find support in exchange rate maintenance in embedded system documentation.

2.3 Settings in Periods

Another prerequisite to run the foreign currency remeasurement is, that the Closing Step 10 – Operational Postings is blocked for the period, for which the run should be executed.

Furthermore, the following period must be open for the same Closing Step.

3 Foreign Currency Remeasurement for G/L Accounts

To execute the remeasurement, go to workcenter General Ledger > Periodic Tasks > Foreign Currency Remeasurement Runs and click on New > Foreign Currency Remeasurement Run for G/L Accounts:

A new screen will be opened to enter the run parameters and to set the selection criteria. Also, you can specify whether the run should be performed as a Test Run. The information about the Company and Period/Year are mandatory. Furthermore, you can select a certain Set of Book and a specific currency. If you do not select something, the run includes all Set of Books which are assigned to the company and all currencies, relevant for the assigned period.

Additionally, a selection by G/L accounts is available, to include/exclude certain accounts.

Once you have done the settings for parameters and selection, you can either Schedule to perform the run on another date/time or you can Start Now to execute the run right now.

Once the Processing Status of the run is completed, a logfile is available to show the run results for each Set of Books.

In General tab you get an overview about the results, run information and messages. A Data Selection tab and a Messages tab are available as well – as it is for other runs in a Business ByDesign system.

On tab Postings you find under Accounts a summary of the postings on account level. The lines assigned to run period are the remeasurement postings. For these is the posting date the last day of the month, given in the run selection. In the following period these postings will be reversed on the first day of the month.

On subtab Documents all created Journal Entry ID’s are listed with further information:

With a click on the Journal Entry ID you can jump into the Journal Entry directly:

As you can see a new Reference Source Document Type has been created with the ID 2887.

 

In tab Remeasured Balances in log file you find detailed information to the remeasurement per G/L account:

In case that for G/L accounts balances have not been remeasured, you find these accounts on Not Remeasured Balances subtab.

When a Foreign Currency Remeasurement Run for G/L Accounts has been executed in update mode and you start a further run for the same period, no postings are created, the gain/loss result is zero.

Before a new remeasurement can be done by the system, the previous executed run must be reversed. To do that, you just mark the line of the affected run and click on Reverse button:

On the Open Work List, you can see which runs have been reversed:

The reversal posting will be done with opposite sign:

This short guide helps you to use foreign currency remeasurement to convert balances of General Ledger accounts in SAP Business ByDesign system.

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