1. Posting Foreign Currency
Doc. Header
Exchange Rates
Currency / Rate CAD .95
Conversion Date 05/31/YYYY
04/30/YYYY CAD USD .95
05/31/YYYY CAD USD .97
Line Items
Amount CAD
L/C Amount 2000
IMG / Global Settings / Currencies / Exchange Types & Exchange Rates or
GL >Environment >Current Settings >Exchange Rates
Automatic Postings - /N FBKP
When you post a business transaction in foreign currency, you must overwrite the local currency key proposed in the document header with the corresponding foreign currency key.
You usually transfer the exchange rate automatically from the table of exchange rates. The system uses the posting date as the translation date. The translation date determines which exchange rate the system takes from the table of exchange rates.
You then only need to specify the amount in one currency. The system automatically translates the amount into the other currency.
You can also enter an exchange rate directly in the document header or enter both the local and foreign currency amounts in the line items, thus overriding the entry in the table of exchange rates.

2. FI-View Four out of six currencies per company code
Automatic calculation of currencies
Display of currencies in the document
Selection of exchange rate type, source currency and type of translation date
Valuation differences can be posted separately FI
Document
Transact.
Currency
Local
Currency
Addition.
Curr. 1
Addition.
Curr. 2
While automatic postings of the extra currencies takes place and runs parallel in the documents, it will require that a line item variant be constructed in configuration to be able to see all the various currency values when examining open items in a line item display.
Path: FI Config >Business transations >Base Parameters >Display format and then 揷hoose?the line layout button. Create the variant here that will be used or can be used when displaying G/L or Business partner information.
In the Document itself, one will always be able to see the various currencies assigned by using the 揹isplay currency or more?push button that will appear and selecting the appropriate push button from the pop-up.
The extra currencies required by the company are assigned to the company at FI Config >Environment >Co Code >Parallel currencies > Define. It is not possible to assign the currency methods at this level as they are assigned elsewhere, namely Global Config for countries for hard and index currencies and the client level for Group.

3. Target Group
Companies that have to do internal and/or external reporting in additional currencies
Companies that are located in a country with high inflation
Multinational Groups
Multi-nationals will have the capability of issuing P&L抯 and Balance Sheets in up to 3 currencies.
If so inclined, exchange rate gain or losses determined by 搈onth-end?valuations can be posted to separate accounts for these extra currencies. This would be done in the FBKP table.

4. Possible Currencies (FI)
Local Currency (company code)
Transaction Currency
Group (client) Currency
Global Company Currency
Hard Currency (country level)
Index Currency (country level)
>System >Services >Table Maintenance
Group currency is defaulted from the client level(client 000) which now MUST be assigned in 3.0. As it is defaulted from this level, it does not require any entry into a ledger config table in FI if this is one of the extra currencies selected in the company.
IMG / Global Settings / Set countries /Define countries
Hard currency is country specific and used in highly inflationary environments. eg Brazil.
Index currency: Country specific and fictitious(eg ecu) and used for external reporting such as tax returns.
Global currency;: used for 揷ross-system?entries. i.e system in Europe and another in North America.
IMG / Financial Accounting / Basic Settings / Company Code /
Parallel Currencies / Define additional local currencies for ledgers
Global, Hard, and Index currencies require setting up a ledger in FI Config to make sure that data is captured for these currencies. The other 3 currencies available; Trans, local and group come pre-defined in ledger 0.

5. Additional currencies in FI
Example of currency types in a Multinational Group:
German Group
Group Currency
DEM
US Germany Mexico
Transact. Currency
Local Currency
Group Currency
Hard Currency
XXX XXX XXX USD DEM MXP
DEM DEM DEM
USD
Since 2.2a it is possible to manage two additional currencies in FI for each company code (only for test systems). With 3.0 the two additional currencies can be used in productive systems. The use of the following currency types is possible:
group currency - 30
hard currency - 40
index currency - 50
global company currency - 60
The additional amounts do not have to be enterd manually. The system calculates them using the exchange rate table. Depending on the setting, the document or the local currency is taken as a basis.
Exchange rate differences now do not only occur in the local currency of the company, but also in the additional currencies.

6. Related Subject: Cross Rates
In the system the translation from one currency to another can be done using a base currency.
The translation in this case is done currency A base currency currency B
When this option is used, the translation rates only have to be maintained from the foreign currency to the base currency.
This is essentially a currency used to reduce Maintenance in the currency conversion rate table. One currency, eg $USD, would be tagged to various exchange rate types such as B,G,M, and then all rates in the table would be stated in relation to this base currency. The rates of the other currencies to one another would then be calculated by the exchange rate table or OB08. Thus not as many entries need to be entered into OB08.
The base rate is defined in Global Config through the IMG in Exchange rate types or via trans /nob07.
Before being able to add new currencies as a relation to the base currency you would also have to complete screen OBSS which merely tells the system whether the new relationship of currencies to be created is going to be 1:1 or 1:100 etc.

7. Integration FI to LC FI-CO Integration SD-FI/CO Integration
MM-FI Integration
Areas of integration where the use of parallel currencies can be used.

8. FI to LC FI FI LC Country Company Group Currency Currency Comp.1
Example: US group who owns
1. Company in Holland that has a branch in Germany
2. Company in England that has a branch in France FI
Company Transact. Local Company Group
1 Currency Currency Currency Currency
Germany XXX DEM NLG USD
LC Country Company Group
Currency Currency
Comp.1
Comp.2
Holland NLG USD
England GBP USD FI
Company Transact. Local Company Group
2 Currency Currency Currency Currency
France XXX FRF GBP USD
LC - Legal Consolidation
Description of the above example:
A branch needs to be represented in SAP as a company code for technical reasons (VAT reporting) even though a legal entity may not exist.
No "consolidation" takes place between the branch level and the legal entity level. Eliminations need to be handled through choice of posting methods and chart of account. The LC system starts at the legal entity level.
The companies for Holland and England are not shown on this foil.
Holland and England would have to have USD assigned at the Group (client) level.

9. Integration FI-CO: Case 1
Example: A Mexican subsidiary owned by a German Company
1:1 Relationship between Company Code and Controlling Area
Controlling
Area
Mexico
TC OC CAC
CAD XXX MXP FI CO
CCA
Mexico
TC LC GC HC
CAD MXP DEM USD
expenses
If a controlling area contains only company codes with the same local currency, the object currency in CO is freely definable.
System could be optionally customized to have MXP as the object currency, with either USD (hard currency) or DEM (group currency) as the controlling area currency.
Currency of CO Object: e.g. cost center, internal order or project

10. Integration FI-CO: Case 2
Example: Mexican and Argentinean Sub-
sidiary owned by a German
Company FI
Argentina
TC LC GC HC
GBP ARS DEM USD
Controlling
Area
South America
TC OC CAC
GBP ARS USD
ITL MXP USD CO
CCA
Co-Area
and Group FI
Mexico
TC LC GC HC
ITL MXP DEM USD
expenses
When the currencies of the company codes within one controlling area are different, the object currency in CO is not freely definable any more. The object currency must be the local currency.
Controlling could also be done in DEM instead of USD.
Can be more than one object currency but the Controlling area itself has to be defined as having only one currency.
at 揾istoric?values

11. Integration SD-FI-CO Billing Revenues CO-PA FI SD TC TC LC GC HC GBP
GBP MXP DEM USD SD
revenues
CO-PA
TC OC
GBP XXX CO
Revenues from SD are directly transferred to CO-PA
The operating concern currency could be MXP, USD, DEM or something else. Only one operating concern currency is possible per controlling area. All companies within the controlling area have, per definition, the same operating concern currency.
In release 3.0 CO-PA can be run in 揳ccount form? In this case the currencies apply as shown in the cost center examples.
Currency of operating concern

12. MM-FI Integration without Material Ledger
Material Master LC
MXP MM FI
stock value
TC LC GC HC
MXP MXP DEM USD
stock value
purchasing
transaction MM
Stock after
1. valuation LC
MXP CO
Costs
TC OC CAC
MXP MXP USD
goods issued
with new value
Without the material ledger, the material is valuated either with standard or moving average price.
The calculation of additional currencies in FI from the local currency in the material master is done at the exchange rate of the day the good is issued.
Stocks are not maintained at historical values for the additional currencies. This could be troublesome for countries with high inflation.

13. MM-FI Integration with Material Ledger
Stock value
and expenses
TC LC GC HC
MXP MXP DEM USD MM
Stock
LC GC HC
MXP DEM USD
purchasing
transaction
stock value MM
Stock after
1. valuation
LC GC HC
MXP DEM USD
new stock value
Material Ledger not officially part of Release 3.0! (Pilot Version Only)
Periodical average means, that an average is not calculated each time there is an acquisition but only on a periodical basis.
The valuation is done in parallel for the additional currencies in the material ledger.
In case of a stock issue, the values are not only transferred in local currency but also in the additional currencies.
The stock is not maintained in transaction currency. Depending on customizing and system use the transaction currency is posted in the FI document.
A stock issue(expenses) with the material ledger can transfer up to two "historical currencies" to CO.
With material ledger: only periodical average
price in all currencies