Overview
There are two ways that a company can be said to operate in a multicurrency environment: it can buy or sell in foreign currency, and it can be the parent or subsidiary of a company that uses a currency other than its own. Often both are true. Some of the information in this document applies only to companies that buy or sell in foreign currency, some of it applies to companies that participate in multicurrency consolidations, and much of it applies to both.
Processing
Multicurrency functionality must be activated on the Company Master and Financial Company Master objects.
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On the Company Master
Fields
Home Currency: Home Currency identifies the company’s functional currency (the currency in which its books of account are kept). The Home Currency must first be defined in the Currency Master (see below).
Currency Exchange Rate Source: It must be set to “Use Rootstock” to enable multicurrency operation. When checked, Rootstock will look for currency exchange rates in the Exchange Rate Schedule Object (see below).
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On the Financial Company Master
Fields
Foreign Exchange Rate Schedule: This Indicator must be checked.
Multi Currency Indicator: This indicator must be checked.
Consolidated In Parent Company(off RSTK): Consolidated In Parent Company(off RSTK) may or may not be checked. If checked, the company’s accounts are consolidated into a parent company that does not use Rootstock Financials.
Home Currency of ‘Off System Parent’ must be set when the Consolidated In Parent Company(off RSTK): This indicator is checked. The Home Currency of ‘Off System Parent’ must first be defined in the Currency Master (see below). When the Home Currency of ‘Off System Parent’ differs from the company’s own Home Currency (defined in the Company Master), the company’s accounts may be translated into Home Currency of ‘Off System Parent’ using the Perform Financial Report Data Roll-up processes on the Period Close Activities menu.
Use Expired Exchange Rates If Necessary:
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If checked and if a multicurrency transaction is entered such that no current Exchange Rate Schedule from the Vendor Currency to the Home Currency or from the Customer Currency to the Home Currency exists, Rootstock will use the most recent expired Exchange Rate Schedule.
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If not checked, multicurrency transactions cannot be processed if no current (as of the transaction date) Exchange Rate Schedule from the Vendor Currency (see below) or Customer Currency (see below) to the Home Currency exists.
Currency Master Object (SYCURR)
A record for a currency must exist in the Currency Master Object before the currency can be used anywhere in Rootstock.
Fields
Currency Code: This is the ISO code for the currency.
Description: This is a detailed description of the currency.
EXAMPLE “British Pound”, “US Dollar”, “Euro”.
Current Exchange Rate: Ignore this field. It is only used when Rootstock Financials are not implemented.
Currency on Hold: If checked, the currency cannot be used. This allows a full set of ISO currency codes to be defined for reference or future use even though exchange rates for them are not currently maintained in the Exchange Rate Schedule Object.
Explanation: Ignore this field. It is only used when Rootstock Financials are not implemented.
Currency Major Name and Currency Minor Name: Used for printing Accounts Payable checks.
EXAMPLE Currency Major Name = “Dollars” and Currency Minor Name = “Cents”.
Exchange Rate Schedule Object (SYFOREXSCHEDNO)
This is the home of all exchange rates used by Rootstock Financials (with the partial exception of special rates used for currency translation for financial reporting – see below). An “Exchange Rate Schedule” contains a single time-sensitive rate of exchange between two currencies. Once used in a transaction, they cannot be changed or deleted, as they’re critical components of the transactional audit trail.
Fields
Exchange Rate Schedule: A system-assigned number that uniquely identifies a single schedule.
Description: A user-entered field that should describe the purpose of the schedule.
EXAMPLE “EUR to GBP Friday 3-Aug 2018”.
Schedule Type: One of three values must be selected.
Current Spot Rate: By far the most usual value, this means that the rate will be used for
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Sales Orders and Accounts Receivable.
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Purchase Orders and Accounts Payable.
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The basis of averaging for calculating the P & L rate in multicurrency consolidations.
Month End Spot Rate: This type of rate is used as the balance sheet rate in multicurrency consolidations.
Budget Rate: Used only for translating budget data for multicurrency consolidations.
Currency To Be Calculated / To Currency, Known Value Currency / From Currency, and Exchange Rate: When an Exchange Rate Schedule is used, a value stated in “Known Value Currency / From Currency” is multiplied by “Exchange Rate” to produce a value stated in “Currency To Be Calculated / To Currency”.
Explanation: A system-generated description of what the schedule will do when it’s used in operation.
EXAMPLE “1 EUR equals 1.5 USD” is the Explanation generated when “Known Value Currency / From Currency” is EUR, “Currency To Be Calculated / To Currency” is USD, and “Exchange Rate” is 1.5. Used for “sanity checking” only.
From Date: The date on which the schedule goes into effect.
Thru Date: The last date on which the schedule is in effect.
Schedule is Inactive: If checked, the schedule is no longer to be used in transactions.
EXAMPLE Both XXX and YYY are non-volatile currencies, and the rate from XXX to YYY rarely changes. On 1 August a rate of 2.35 is entered to expire on 31 August. On 10 August the rate unexpectedly changes to 2.40. Schedule is Inactive is checked on the schedule for the 2.35 rate and a new schedule to expire on 31 August is entered for 2.40. Now there are two schedules that seem to be in effect on 10 August, but Rootstock knows to not use the one where Schedule is Inactive is checked.
Bank Account Object (GLBANKACCT)
A Bank Account can have only a single currency assigned to it. This assignment is done by setting the Bank Currency field on the Bank Account Object to the ISO code for the account currency. Deposits into and payments out of the account are deemed to be denominated in the account currency.
Vendor Master Object (POVEND)
If a Vendor does business in a currency other than the company’s Home Currency, two fields in the Vendor Master Object must be set.
Fields
Vendor Currency: This is the ISO code of the currency in which the Vendor does business.
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If the Vendor is first defined as a Salesforce Account, the Vendor Currency is inherited from Salesforce.
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If the Vendor is defined directly in Rootstock, the Vendor Currency is entered directly into the Vendor Master Object.
Maintenance Currency Indicator: In Rootstock, the term “Maintenance Currency” stands for the currency in which a document is denominated. When the Maintenance Currency Indicator in the Vendor Master Object is checked, Purchase Orders, Invoices, and other Accounts Payable documents (including payments) are stated in the Vendor Currency.
Customer Master Object (SOCUST)
If a Customer does business in a currency other than the company’s Home Currency, two fields in the Customer Master Object must be set.
Fields
Currency: This is the ISO code of the currency in which the Customer does business.
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If the Customer is first defined as a Salesforce Account, the Currency is inherited from Salesforce.
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If the Customer is defined directly in Rootstock, the Currency is entered directly into the Customer Master Object.
Place Orders in the Customer Currency: If this is checked, Sales Orders, Invoices, and other Accounts Receivable documents (including Cash Receipts) are stated in the Customer Currency.
SEE ALSO
Multicurrency Considerations in Sales and Accounts Receivable
Multicurrency Considerations in Purchasing and Accounts Payable
Multicurrency Considerations in Bank Reconciliation
Multicurrency Considerations in Financial Reporting
Multicurrency Consolidations
