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Tag Archives: Bank

Foreign currency revaluation cash and bank management module

12 Sunday Apr 2015

Posted by Ludwig Reinhard in Bank Management

≈ Comments Off on Foreign currency revaluation cash and bank management module

Tags

Bank, Dynamics AX 2012, Foreign currency revaluation

For most users, Dynamics AX does not provide a foreign currency revaluation functionality in the Bank Module. As a result, differences between the General Ledger Module and the Bank Module can arise. The following example illustrates how those differences might arise and what users can do to avoid them. (Note: All EUR/USD exchange rates used in the following are purely fictional).

Scenario
A company located in the EURO-zone has some idle foreign currency reserves (3 mio. USD) and deposits them in its bank account („Bank 13“) on 15 December 2014. At the time the money is deposited, the exchange rate between the EUR and the USD stands at 0.73 EUR/USD resulting in an amount equivalent to 2.19 mio. EUR. EN_KRB_1On 31 December 2014 the EUR/USD exchange rate is 0.70 EUR/USD. At this exchange rate the foreign currency deposit value expressed in EUR-currency is 2.1 mio. To track the exchange rate loss in Dynamics AX, the periodic General Ledger foreign currency revaluation process is run. EN_KRB_2The result of this periodic process is that a foreign currency loss of 90000 EUR is recorded on the main account “Bank 13” in the General Ledger Module.EN_KRB_3As this transaction is recorded in the General Ledger Module only, a difference between the General Ledger and Bank Module balance for Bank Account 13 arises as illustrated in the following screenshots. EN_KRB_4 EN_KRB_5

Solution
To fix this issue the (country-specific) foreign currency revaluation functionality in the Bank Module can be made available for all Dynamics AX users. This can be realized by adding country codes into the “BankExchAdj_RU” menu item.EN_KRB_6Similar changes are required in the “BankExchAdj_RU” class and for the extended data type „BankExchAdjVoucher_RU“. The next screenshots illustrate the changes required.EN_KRB_7 EN_KRB_8 EN_KRB_9After doing all those adjustments a new foreign currency revaluation functionality can be identified in the periodic section of the cash and bank management module. EN_KRB_10The only thing missing to use this functionality is setting up a number sequence in the Bank Module parameters to record the exchange adjustment vouchers. EN_KRB_11

Finally, all the transactions that have been recorded on “Bank 13” are re-entered for “Bank 14”. The only difference is that the periodic foreign currency revaluation process is now run from the Bank Module rather than from the General Ledger Module. The outcome of those transactions can be viewed in the next screenshots. EN_KRB_12 EN_KRB_13 EN_KRB_14As one might expect, using the new foreign currency revaluation functionality that is available in the Bank Module results in identical balances in General Ledger Module and the Bank Module.

Project Accounting Book – Part 2

Project accounting book

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