With Parallel Currencies Enabled

The application can be configured at a system-level to support parallel currencies for postings. The Exchange Rate Type configuration table in the Financial Organization Structure defines the conversion from contract to company currency, as well as all of the group currencies (and whether the amounts are converted from contract or company currency).

Note that currency translation differences will occur on the offsetting account, so liabilities and assets may not be cleared in all currencies.

When the financial schedules are generated:

The application verifies the Exchange Rate Type configuration table and looks up the currency type 10 for contract to local (company) currency conversion, as well as other configured exchange rate types. From the extended configuration, the application gets:
- Exchange Rate Type: M (contract to company currency conversion)
  - Target Currency: The configured company code currency.
  - Source Currency: The application looks up the contract currency.
  - Translation Date: Regardless of the configured value, the application always uses the ROU Start Date to look up the exchange rate.
- Exchange Rate Type: All others
  - Target Currency: The group currency.
  - Source Currency: The application converts from either the contract currency or the company code currency.
  - Translation Date: Regardless of the configured value, the application always uses the ROU Start Date to look up the exchange rate.
The application verifies the Depreciation Area Determination table, and finds the mapped Exchange Rate Type entries to determine the currencies for asset postings.
The application looks up the Exchange Rate table to get the exchange rate from the source currency to the target currencies.
The application calculates the initial liability and asset capitalization amounts in the company code and group currencies for the inception journals. Note that if carry-over balances have been entered, the application uses a weighted average exchange rate to calculate the asset capitalization amounts.

Payment, accrual, and charge values are posted in all configured currencies (configured in the Exchange Rate Type table). When a posting is triggered:

The application looks up the Exchange Rate Type configuration table to retrieve:
- Currency type 10 (Exchange Rate Type M) for the parameters to calculate the amounts in local (company) currency.
- Other configured exchange rate types (e.g., GRP) for the parameters to calculate the amounts in group currencies.
  - Target Currency: The group currency.
  - Source Currency: The conversion is from either the contract currency or the company code currency.
  - Translation Date: The application can use the Posting Date, Document Date, or Translation Date (where the current date is used) to look up the exchange rate.
The application retrieves the currency conversion rates from the Exchange Rate table, and calculates the amounts in all of the available currencies.
The application uses the amounts in all currencies for all the journal postings.

For depreciation postings, the application converts the amounts to the target currencies defined in the Depreciation Area Determination table, but it uses a weighted average exchange rate to convert the amounts (and does not look up the daily spot rate in the Exchange Rate table).

When there is a negative ROU delta amount (e.g., following a lease modification for Decrease Asset Value or Decrease Lease Term, or a reassessment to add a Reduction term), the application uses a weighted average exchange rate. If the amount is positive, the application uses the spot rate to convert the amount to company and group currencies. See Weighted Average Exchange Rate for more information.