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GL: Currency

Discussion in 'General' started by jagadekara, Mar 20, 2014.

  1. jagadekara

    jagadekara Forum Guru

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    Currency in General Ledger is one of the 4C’s.

    In R12 there is an additional feature given that if you have a separate Reporting Currency then you don’t need to create a separate ledger. You only need to define a Reporting Currency ledger in your Accounting Setup Manager.

    There are two types of Currency in Oracle:

    • Functional Currency: Currency thatis attached to Primary Ledger or in other terms the Local Currency. For example functional currency for Pakistan is PKR. Any organization operating in Pakistan will have a functional currency as PKR.
    • Entered Currency: Currency attached to primary ledger other than the functional/local currency and is used while entering the transaction. For example if any multinational organization is operational in Pakistan and it uses any other currency than the local currency of Pakistan then that currency will be termed as entered currency. Entered currency is always converted to Local Currency when it is posted in the final accounts.

    Currency Conversions

    • Conversion: Foriegn Exchange (Forex) rates of the functional and entered currency. The rates are defined in the table. This rate is used to convert the entered currency into the functional currency. The naviagation to Rates in GL is Setup>Currencies>Rates>Dialy or Historical
    • Revaluation: It is a program that revaluates the entered currency into the current forex rate. This program is run immediately before period closing.
    • Translation: Used when consolidation is needed and transactions are done in multiple currency.