Currency Management – With Version N Muli introduced the ability to process multiple currencies. When a system is set up, Bank Z is established as a default bank used for all inter-company transactions and journals. The currency applied to Bank Z is considered the system-wide currency used for ALL company accounting and general ledger reports. Individual orders may be raised nominating a different currency, ie Euro (provided the currency has been authorised using a nominated bank account in that currency), then the committed value on the order is expressed in the nominated currency. The issue with foreign currency is what factor is applicable to calculate a future transactions, noting payables & receivables may use differing conversion values. We really only know the real impact when the payment is finally converted back to local currency.Muli maintains a Fx file containing:-
- Transaction type auto from real accounting transactions or manual record
- Payable factor
- Receivable factor
- Payable value (only if real transactions)
- Receivable value (only if real transactions)
But still guessing game. Exchange Rates can vary extensively over time. As part of the Trial Balance preparation where foreign currencies are in use, settlement factors will need to be confirmed and emerging gains or losses on foreign currency account factored into the general led – Fx (A-Z) provided in Balance Sheet Fx (A-Z) provision in Profit & Loss.
When an order is raised with a given exchange rate provision, a Risk2Do item is created as soon as an exchange rate variation actually occurs or expected variance value on settlement exceeds $100. The Risk2Do for exchange rate is verified each time a cost report is created. (Should the reviewer change the rates, then it is recorded in the tranlog.