SAP FI FAQs – Currencies

1.    How can a document obtain exchange rate information?

•    From the Exchange rate table
•    From a manual entry in the document exchange rate field

2.    What are exchange rate types used for? List and describe five exchange rate types.

Exchange rate types are used for foreign currency revaluations and postings.

–    B (Bank Selling Rate)
–    G (Bank Buying Rate)
–    M (Average Rate) – The default rate type for posting documents.
–    EURO – Used for exchange rates between EU member nation currencies (e.g., DEM:FRF)
–    EURX – Used for exchange rates between an EU member nation currency and a non-member nation currency (e.g. DEM:USD)

3.    List the currency types used in FI.

The available currency types are transaction, group, hard, index, global, and company code (local).  Please note that this list is not exhaustive as other modules may also have their own currency types (e.g., controlling area currency).

4.    How many currency types can be used at one time for each company code?

Up to four currencies can be used for each company code.  They are transaction, local, and up to two optional parallel currencies.

5.    Explain the base currency function

A base currency is set up to eliminate the need for entering every possible exchange rate combination into the exchange rate table.  A base currency is established on the exchange rate type table for a specific exchange rate.  The base currency and base rate are then used to translate from Currency A to the base currency and then from the base currency to Currency B.

6.    Explain why a translation ratio is useful.

A translation enables SAP to process extremely large or small exchange rates that would exceed the maximum allowable number of digits (i.e., 9999.99999 or 0.00001).

7.    What are the prerequisites for posting a document using foreign currencies.

–    Local currency must be defined in the Company Code Global Parameters
–    The foreign currency must be defined in the Currency Code Table
–    A translation ratio must beset between the foreign and local currencies
–    An exchange rate must be defined between the foreign currency and the local currency in the Exchange Rate Table.

1. How can a document obtain exchange rate information?

· From the Exchange rate table

· From a manual entry in the document exchange rate field

2. What are exchange rate types used for? List and describe five exchange rate types.

Exchange rate types are used for foreign currency revaluations and postings.

B (Bank Selling Rate)

G (Bank Buying Rate)

M (Average Rate) – The default rate type for posting documents.

EURO – Used for exchange rates between EU member nation currencies (e.g., DEM:FRF)

EURX – Used for exchange rates between an EU member nation currency and a non-member nation currency (e.g. DEM:USD)

3. List the currency types used in FI.

The available currency types are transaction, group, hard, index, global, and company code (local). Please note that this list is not exhaustive as other modules may also have their own currency types (e.g., controlling area currency).

4. How many currency types can be used at one time for each company code?

Up to four currencies can be used for each company code. They are transaction, local, and up to two optional parallel currencies.

5. Explain the base currency function

A base currency is set up to eliminate the need for entering every possible exchange rate combination into the exchange rate table. A base currency is established on the exchange rate type table for a specific exchange rate. The base currency and base rate are then used to translate from Currency A to the base currency and then from the base currency to Currency B.

6. Explain why a translation ratio is useful.

A translation enables SAP to process extremely large or small exchange rates that would exceed the maximum allowable number of digits (i.e., 9999.99999 or 0.00001).

7. What are the prerequisites for posting a document using foreign currencies.

Local currency must be defined in the Company Code Global Parameters

The foreign currency must be defined in the Currency Code Table

A translation ratio must beset between the foreign and local currencies

An exchange rate must be defined between the foreign currency and the local currency in the Exchange Rate Table.

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