Foreign Currency valuation accounting entries

Dear friends
At the time of revaluating foreign currency at period end, an accounting entry gets generated, which is reversed on 1st day of the next period. As per my understanding, the entry is as below -
Forex Loss Dr
Vendor Adjustment A/c
My question is whether the Vendor adjustment G/L is a Recon a/c? Also, in what transaction code, this customization is done?
Thanks in advance
Amit

Hi,
Please check all your settings correct or not?
Step1: Forex Rates should be maintained OB08
Step2: Define Valuation Methods
Step3: Define Valuation Areas
Step4: GL Account Creation for Forext Loss and Gains,
Step5: Assign GL Acconts
Step6: Foreign Currency Valuation T Code: FAGL_FC_VAL
Thanks
Chandra

Similar Messages

Intercompany payment posting after Foreign currency valuation - F.05

Hi Gurus,
I have an issue with intercompany payment posting after foreign currency valuation run.
Build Up:
Let me give you a brief description first. Company u2018Au2019 has open items from Company u2018Bu2019. Basically Company u2018Au2019 charges management fees from Company u2018Bu2019. Both companies have a local currency of u2018EURu2019 and a group currency of u2018USDu2019. The open items posted in company u2018Au2019 have been accumulating for two years now. In January of this year finance decided to run the foreign currency valuation (F.05). The method they used was the reversal method. So at the beginning of the next month the entries from the valuation were reversed. They repeated this in February as well. Note this is the first time the foreign currency valuation was performed in SAP, before it was done manually. After February they never ran the foreign currency valuation run.
Issue:
Now what is happening is, when open items that have been accumulating for over two years and are before the foreign currency valuation run are cleared (payment is made) there is a exchange rate loss/gain. When the open item is cleared there is posting to the G/L account for Balance sheet adjustment and also an exchange rate loss/gain G/L account.
Posting:
Debit u2013 Cash
Credit u2013 Customer (intercompany)
Credit u2013 Balance sheet adjustment account (unrealized loss)
Debit u2013 Profit and loss account (realized loss)
The balance sheet adjustment account that is posted to is from OBA1 u2013 KDF u2013 balance sheet adjustment account in the foreign currency valuation accounts. Currency translation account determination is empty in OBA1.
I understand the system while payment posting is clearing/offset the unrealized loss/gain and posting the realized loss/gain. But how is this possible, when the foreign currency valuation run was done the entries were reversed so there was no unrealized loss/gain posted.
Also another caveat: Isnu2019t foreign currency valuation for open items that are posted in foreign currency and need to be revaluated to local currency. Well that is what is puzzling the open items posted in company u2018Au2019 are posted in local currency u2018EURu2019 so the foreign currency valuation should not affect these open items, correct? And if this is true then when the open items is cleared the unrealized loss/gain should never be cleared since there is none posted the exchange rate difference should only be posted to the realized account in the profit and loss correct? Please help? I can explain further if needed?
Thank you.
Comments and facts:
Companies fiscal year is June u2013 May.
Company u2018Au2019 and u2018Bu2019 have a local currency of u2018EURu2019, group currency is u2018USDu2019
The invoices in Company u2018Au2019 were posted in u2018EURu2019
The foreign currency valuation was only ever run in January and February of 2010.

HI ,
I believe becuase you did not enter any date that's why they did n't reverse automtcially . You need to enter to reverse.
now you can use f.80 mass reversal for all of them
Many Thanks

Foreign Currency Valuation not posted to GL account

Hi,
While I run foreign currency valuation even tick on check box of Create Posting button under FAGL_FC_VAL it show me summary report and posting tab it show me properly Debit/Credit entry on last day of month and 1st of month it become reverse as usual. But while I go through respective GL account of "Forex Unrealised Profit" and " Foreign Exchange Adjustment" account in FBL3N it does not show me line ietms result after running foreign curreny valuation. It should show the result in respective GL accounts where line items are tick in each GL accounts and valuation method I use EVR(always valuate). Why it is happening ?
Best Regards,
Anindita

Hi,
After executing FAGL_FC_VAL, do you execute Batch Input Session in SM35. If no then
When you execute FAGL_FC_VAL you will find the field called Batch Input Session name where you have to give a name for e.g. FOREXVAL. Once you execute it then system creates Batch Input Session in SM35. So go to SM35 and select the session FOREXVAL and click on Process icon seen on the top and select Display errors only and press ok.
Regards,
Chintan Joshi.

Foreign currency valuation for GR/IR clearing account is repeatedly posting

While executing foreign currency valuation (program SAPF100) through T code F.05 the following fields are selected for the spotted rate valuation for currency type 10.
A)     Valuate G/L account open items
B)     Evaluate GR/IR account (GR/IR clearing account is selected)
C)     Valuate customer open items
After execution the valuation postings are repeated in GR/IR FC valuation Balance sheet adj account while the postings in other accounts occur only once.
GR/IR FC valuation Balance sheet adjustment account is configured in OB09 for GR/IR account for respective currency type and local currency.
What could be the reason for repeated postings in FC valuation account?

I think there is some issue with the process, normally vendor/customer reconciliation account or some liability assets related account which has impact due to foreign currency rate changes needs to be revaluated. I don't understand why you have set up foreign currency valuation for GR/IR account, these are intermediatory account which reflects in system between for example GR and IR.
I also think that you need more information on foreign currency valuation, basically it happens on a particular key date and gets reversed on key date + 1, because revaluation is only required on a key date for reporting purposes. on the next day it get reversed and actual loss or profit on foreign currency only gets booked on realization.
Hope this helps!!!
Murlidhar Khatri

Foreign currency valuation differences for reconciliation accounts

Hi gurus,
we have run the transaction FAGL_FC_VAL - Foreign Currency Valuation (New), now i try to make a report summirazing valuatin differences of the open line items by customer, vendor and gl account. however i cannot found the tables which the valuation differences are recorded. ( i dont find the values in the table bsbw in any FI document)
the customizing is (tcode oba1)
Exchange Rate Dif.: Open Items/GL Acct:
for customers:
G/L account: 1201xxx
Bal.sheet adj.1: 1209xxx
loss: 65xxxxx
gain: 64xxxxx
can you help me?
thx.

Is there any way to keep track of FC valuation differences by customer basis?
i dont see how much FC differences occured for a spesific customer!

Foreign Currency valuation on Foreign currency items posted in Local currency accounts

Hi Gurus,
I have accounts maintained in local currency and only balances in local currency is not checked. Some items are posted in foreign currency.
Now system is doing foreign currency valuation on foreign currency balance of this account. I dont want system to do that.
Now how to correct it. I can make balance zero of account and then mark that tick of only balances in local currency but still system will do foreign currency valuation on items posted.
Appreciate you help in solving this issue. How to handle it?
Thanks

Hi ,
While executing Foreign currency valuation, you can select the GL accounts for valuation. Try to not input these local currency GL's.
Cheers,

Post foreign currency valuation for special G/L accounts

Dear experts,
Our client wants to evaluate the balance of down payment account after each partial clearing with invoice.As down payments are being posted by special G/L indicators, they are not able to post to the down payment account directly.
and there is no possibility to post foreign currency valuation by SG/L indicators in F-05 and FBB1 transaction codes.
Could you please tell me how we can evaluate a SG/L account directly?
Best Regards,

Hi Rezvan,
That is not possible also this is not required.
Because unrealized gain/loss we post to Balance sheet adjustment account and Fx gain/loss accounts.
We don't post any differences directly to sub ledgers.
you can use F.05 or FAGL_FC_VAL trasanction for Foreign currency valuation.
where you can have option of valuate the Spl GL too in selection screen.
Also
When you select Vendor option in FAGL_FC_VAL, program valuates all the line items including special gl items.
And this valuation difference can be posted to balance sheet adjustment account which you maintain in OB09.
Regards
Atul

Accounting document created after foreign currency valuation

Hi SAP Gurus,
Please help on below queries:
1. Is it correct that Accounting document is automatically created when foreign currency valuation (F.05) was run and 'Reverse Posting' was ticked? Does it mean that two document will be created; one is for Revaluation Journal and the other one is for Accounting Document?
2. In relation on above question, is it correct that Accounting document and Revaluation Journal have the same posting date and amount?
3. When Accounting document and Revaluation Journal have the same posting date and amount does it mean that the account has not been revaluated?
Appreciate your advise. Thank you.

There will be two accounting documents generated, one for posting the revalution and the other for the reversal (if reversal is activated). The reversal dates can be given manually else system takes the 1st of the N+1 Period. The revaluation posting date will be taken from the date given in 'valuation date'.
Warm Regards
Nitika

Balance sheet adjustment account for Foreign Currency Valuation

Hi all,
I know that we enter AP /AR balance sheet adjustment account for Open items account when we configure for Foreign currency valuation with Tcode OBA1 and KDF. I wanted to know what account can I enter in that field for other balance sheet account which are not open item managed?
Also, Do we valuate GR/IR accounts in foreign currency valuation?? If yes, what balance sheet adjustment account do we enter for those accounts?
Thank you.

HI,
The valuation of <b>foreign currency balances</b> requires a special key that is assigned the gain and loss accounts for posting any exchange rate differences that occur during valuation. You can freely define this key. You then enter it in the master records of the accounts that you want to valuate. To post the differences that are determined from a group of G/L accounts to the same gain or loss accounts, enter the same key for all these G/L accounts.
Create the Create here with Tcode OBA1 and KDB-Exch. Rate Diff. using Exch. Rate Key
And assign this in the GL account master in the Control Tab.
Thanks
Vijay

FOREIGN CURRENCY VALUATION ADJUSTEMENT ACCOUNTS.

HI,EXPERTS
I WANT TO CALCULATE FOREIGN CURRENCY VALUATIONS FOR VENDORS AND CUSTOMERS OPEN ITEMS,
SO I HAVE TO CREATE BALANCE SHEET ADJUSTMENT ACCOUNT IN FS00..
IS IT RECONCILIATION ACCOUNT OR NOT? HOW CAN I THIS ACCOUNT ACTIVATE IN CUSTOMIZATION?
DO I HAVE TO CREATE 2 ADJUSTMENT ACCOUNTS ,1 FOR VENDOR PAYABLES AND ANOTHER FOR CUSTOMER
RECIEVABLES?
REGARDS,
THANKS IN ADVANCE.

Hi,
separate G/l is useful of reporting so use the below settings
Customer Reconcilation account     - change if vendor reco account
Loss G/L     -For customer & vendor same G/L
Gain G/L     - For customer & vendor same G/L
valuation G/L -1     - For customer & vendor same G/L
valuation G/L -2     - For customer & vendor same G/L
Debtors Ex.Rate Diff Adj. A/c     - use vendor ex. rate diff a/c.
assign points if hep full for you.
Regards
Aditya

Accounting Principle role in Foreign Currency Valuation

Dear Frns,
Why do we create an Accounting Principle in Foreign Currency Valuation and assign the same to the Ledger Group.
Regards,
Venkata

Hi Venkata,
The Assignment of Accounting Principle to Ledger Group is to ensure that the system knows to which ledger group the valuation is to be done. Since we can valuate the foreign currency documents to ledger specific posting as well.
Say there is one ledger pertaining to Leading ledger 0L and another non leading ledger L1, where 0L is pertains to US GAAP and L1 pertains to IFRS. So based on requirement, during the execution of FAGL_FC_VAL, you specify valuation area which will post to those areas.
Hope this is clear.
Regards,
Rithin

Error when using automatic clearing (F.13)with foreign currency valuation.

Hello all
below is our problem, please suggest us a solution
We are experiencing a problem when running the automatic clearing in SAP. Somehow, the system seems to clear (with no reason) open items created with the revaluation of foreign currency.
Let's say that we run the valuation of open items in foreign currency for December 31, and we run the program to post the reverse entry as of January 1 of the next year. As a result of this valuation, the system calculates a loss of 10 euros. Therefore, it posts a document with a debit entry of 10 into the Loss account, and a credit of 10 in to account where the valuation was carried out. This document has a posting date of December 31. The batch program also creates the reversing entry, this time a credit entry into the Loss account, and a debit into the original account.
If now, we try to run the automatic clearing (F,13) on December 31 for those accounts, the system will create (automatically) a document on December 31, similar to the reversing entry that the valuation created, clearing at the same time, the first document that the valuation originally created.
The final result then is that the valuation makes a posting, and we end up having two reversing entries. Does it make sense?
In our scenario in the system P70, for MX10, we have a foreign currency valuation run on December 31st, which posted the document numbers:
1) 5100004579/2008, for a total of 0 euros, and 240,483.17 MXN. Credit to account 11081108 Finavigate cash receipt bank collect.CMG MXN.Debit to account 18601000 Losses f.foreign curr.valuation on financial trans
2) In the same batch, the system also books a reversing entry (doc 5100000042/2009) with posting date 01.01.2009 with exactly the same opposite entries as in the previous document.
3) After this, we run the automatic clearing with posting date 31.12.2008, and now, the system creates automatically the document 5000003236/2008, which clear the original document, 5100004579.
The final result, as you can see, it's out of balance, there is an additional document that we need to reverse.
Thanks in advance
sujatha

To my knowledge you get do two things:
1. In F.13 transaction don't include both the GL accounts where the Dr. and Cr. posting from the valuation run have taken place. With this the system won't find the matching entry.
2. If you want to use all the GL accounts in F.13, then check the clearing procedure configuration and make suitable changes.
With the info provided, this is the only thing I can suggest.
Regards,
~Vishal.

Why foreign currency valuation is required ?

Hi.
I just want to clear my doubt. If we deal with foreign vendors or customers like vendor invoice is done through USD or EUR or GBP but payment is not made till now or customer invoices are done but payment is not received from them in month of August. In that case if we run foreign currency valuation of open vendor invoices and open customer invoices on 31st August it will generate accounting entry and next day i.e, 1st September accounting entry will be reversed. So my question is we have not received from customer and we have not paid to vendor, invoices are still open from customer and vendor side. So if we run foreign currency valuation what will be its actual effect in the business and if we not run foreign currency valuation what are the problems may arrises because later if we pay to vendor through foreign currency then actual loss / gain effect will arrise in our business scenario.
Kindly give me reply.

hi
As part of the period end process, and in anticipation of creating a period-end financial statement, all accounts held in foreign currency and all foreign currency open items must be re-valued at the period end rate. There are two tools within the SAP ERP Packaged Solution for this purpose:
Foreign Currency Revaluation u2013 Balance Sheet Accounts: The program selects every balance sheet account, typically cash accounts, that is held in a foreign currency and re-values the total balance at the currently valid rate. Any (sterling) exchange rate difference is posted to a realised gains/losses account.
Foreign Currency Revaluation u2013 Open Item Accounts: Open item accounts managed in GBP, such as debtors and creditors, may contain foreign currency transactions. The program will individually revalue each open item to determine an overall unrealised foreign exchange gain or loss position. The realised exchange rate gain/loss is posted when the transaction is cleared.
It is a statutory requirement to meet hte FAS52 and GAAP requirements
thanks
Srilaskhmi

Query on Foreign Currency Valuation(FCV)

Hello Friends,
Foreign currency valuation(FCV) program unable to post the entries when we maintain an Open item managed GL account as Balance sheet adjustment account in OB09.
Why this program unable to post the entries to a open item managed GL account?
Is there any SAP Note available for this?
Rgds
Murali. N

Murali,
I am sure you must have done all of these , but i will suggest few checks.
1) Is the document currency and Local Currency same ? In which case it wont generate a reval
2) Check the Valuation group in G/L Master for Original G/L account for which it is supposed to book adjustment. Make sure that right valuation group is assigned and it is supposed to undergo reval.
3) Can you check Table T030HB, this is where the mapping for valuation area and B/S sheet account with Balance Sheet Adjustment account is maintained. Can you please check whatever is the valuation group in the source account ( for which adjustment needs to be booked) is maintained over here.
Based on my experience , #3 is not so uncommon and sometimes people maintain OB09 but forget about maintaining it on valuation area level
Hope it helps .

Foreign Currency Valuation customers, (outstanding invoices) F.05

After using F.05 for foreign currency valuation I am surprised by example outstanding CHF invoices keep the same EURO figures.
When I look to the report F.05 gives after using the session it shows a calculation for each CHF invoices to the new EURO figures,
but after processing the batch with SM35 there is no change of the EURO figures by these invoices.
After a while I noticed this kind of currency differences are booked on another GL account.
So there is one GL account for outstanding debtors and another one what gets the currency rate differences after using F.05.
Never the less is it not very strange when I am using line items reports to show the invoices of outstanding debtors that on invoice level the EURO figures still have the same figures?
By example 42000 CHF are equal 25000 EUR and after using F.05 the report says this 42.000 CHF are equal to 28000 EUR.
I should expect the EUR figures of 28000 would I see back in the oustainding invoice reporting, but that's still showing the old amount of 25000.
I know SAP shows the difference on another GL account but is it not strange this kind of currency differences are not in the outstanding invoices figures. I should expect by the invoices the EUR figures after currency valuation.
Is this how SAP works? Or did we something wrong when we set up our own SAP version?:-)

Hi,
This is how the accounting is done. Basically at the year end the foreign exchange gain or loss is accounted for in a separate account of respective master data like customer , vendor & profit and loss is effected. generally FAGL_FC_VAL is used where there is ecc 6. And the reversal date is set for this effect. At the start of the year this entry is revesed. And the actual gain or loss is accounted for at the time of liabilty/ income crystalisation i.e. payment\ receipt of foreign exchange.
Regards
Milind Sonalkar

Foreign Currency valuation accounting entries

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