Exchange Rate Differences in SAP

When clearing open items in a foreign currency, exchange rate differences may occur due to fluctuations in exchange rates. The system posts these exchange rate differences automatically as realized gains or losses. The realized difference is stored in the cleared line item.

Exchange rate differences are also posted when open items are valuated for the financial statements. These exchange rate differences from valuation are posted to another exchange rate difference account and to a financial statement adjustment account. When clearing an open item that has already been valuated, the system reverses the balance sheet correction account and posts the remaining exchange rate difference to the account for realized exchange rate differences.

All reconciliation accounts and all G/L accounts with open item transactions in foreign currency must be assigned revenue/expense accounts for realized losses and gains. One gain/loss account can be assigned:

To all currencies and currency types

Per currencies and currency type

 Per currency

Per currency type

Procedure to Maintain Exchange rate in SAP 

1 .Check Exchange Rate Types                                                             OB07

2 .Define Translation Ratios for Currency Translation              OBBS

3 .Enter Exchange Rates                                                                          OB08

4 .Specify Default Exchange Rate Type in Document Type      OBA7

5. maintain Exchange rate difference for Account in                  OB09

If you manage parallel currencies, generally all balance sheet accounts are to be valuated, not only accounts that are managed in foreign currency or that have open items in foreign currency. Variants for the valuation programs SAPF100 and RFSBEW00 are therefore to be adapted with regards to the selection criteria for the accounts to be processed.

In a valuation run, different currency types can be processed in parallel. Since the valuation methods for the currency types can be different, the parameters for the valuation programs have been extended. You can specify a valuation method for Local currency, group currency, hard currency, index-based currency and global company currency respectively. A valuation is carried out exactly for those currency types for which a valuation method is predefined.

If you want to post the valuation for certain balance sheet accounts manually because the valuation was determined outside of the SAP system (for example, for foreign securities), you can do that in the General Ledger menu via Document entry -> Valuate forgn curr.. You can enter the amounts in local currency or in the currencies managed in parallel on the entry screens for the document entry. All amount fields not entered receive a zero value. An automatic translation of amounts does not occur.


2 thoughts on “Exchange Rate Differences in SAP

  1. In recent times the Pound has not performed well against the Euro. Bearing in mind that there is a crisis developing in Europe at the minutes, I would hate to see where the pound would be if Europe was stable. The Euro crisis is masking Britians failures.

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