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How To Set Multiple Currencies For Company Code or Group

Go to OY01 Select your country key and double click on it. In that mention your hard currency key and index based currency keys. Then go to ob22 IMG Menu Path: Financial Accounting --> Financial Accounting Global Settings --> Company Code --> Parallel Currencies --> Define Additional Local Currencies Give currencies for 2nd and 3rd local currencies. Here you need to give 40 in the 2nd local currency and 50 for the 3rd local currency. Exch Rate type: M Source Curency : 1 Type of transalation: 2 SAVE Remarks: I am going through a decision process right now with my client regarding this configuration. When my client first came up on SAP 9 yrs. ago, they only had 1 currency. Since then they have made acquisitions and now have multiple company codes with different currencies. What I have found out is that once you set up a Company code for only one currency you cannot turn on Multiple/Parallel currencies in that company code. Fixed Assets are affected and so are all the AP & AR transactions. AR & AP can run into issues when it attempt to create and additional posting to the Group Currency because of Exchange Rate differences. In my opinion, I beieve it was a major mistake not to have turned on Additional Local Currencies from the beginning. What this does is allows you to establish a "Group Currency" in the FI Module. In table GLT0 you can see that there are columns way out to the right when you view postings via SE16 in columns titled AMOUNT. These are the group currency postings. You can then generate reports that pull this detail for consolidated reporting.

International Org Structure -Controlling Area, Parallel Currency


International Org Structure - Controlling Area, Parallel Currency The decision of how many controlling areas you need is dependent on 1. whether the chart of account is shared among the companies 2. fiscal year variant (calendar year or October-September, 4-4-5 etc..) for each company If you choose 2 Cross Company Code Costing and 20 Controlling Area Currency, you can hold controlling area currency and object currency i.e. company code currency (object means cost center or CO orders etc..). Only one chart of account and one fiscal year variant is allowed for a controlling area. The basic concept of SAP product is to share chart of account and controlling area among different company codes. You would learn this if you take SAP training courses. The benefit of sharing chart of account or controlling area is, you can reduce the implementation workload as a whole.

MM account setting (inventory accounts), FI and FIAA account settings, all account determination settings are chart of account dependent. (This account setting itself can be copied at IMG Copy chart of account though, where you copy Financial Statement Version.) Cost element (primary & secondary), settlement cost element settings, activity type, are controlling area and chart of account dependent. You don't need to map Tax category, Field Status Group for G/L accounts (Company Code Level) from the scratch. You can use the same Financial Statement Version (this is in fact the biggest benefit). You can use the same Transfer Structure setting (settlement cost element setting) to CO-PA (And this makes the second biggest benefit) If you take company code copy, you don't need to go through module integration testing every time you have new company code, because account setting is shared. User can use the same operating manual, since chart of account is the same.

From my experience, it makes total implementation effort a lot easier. If you use the same chart of account among multiple company codes, you need to set coding rule how to use it. For example, first 6 digits are reserved for group purpose, other 2 digits for individual companies. Also you can set different inventory account setting by individual plants for main inventory accounts (BSX), COGS accounts (GBB) etc. even if chart of account is shared. (There are exceptions such as CO order settlement accounts, GR/IR (WRX), etc.. Usually these do not become an issue.) This is of course, if need be. IMG MM > Valuation and Account Assignment > Account Determination > ..Without

Wizard > Define Valuation Control (t-cd OMWM, activation) > Group Together Valuation Areas (t-cd OMWD) > Configure Automatic Postings (t-cd OMWB, Tick on 'Valuation modif.' in the Rule) Multiple controlling areas can be assigned to the same operating concern of the CO-PA Profitability Analysis. You can have operating concern currency and company code currency depending on your customizing. Group chart of account is also usable among different chart of accounts. This is originally for EC-CS, but still is used for SEM-BCS. You set Group COA in t-cd OB13, and map group account to each account master. This master data mapping is done in chart of account level (table SKA1, A-segment, t-cd FSP0). You can also have 'Country Chart of Account' (also called 'alternative accounts') for countries where chart of account structure is regulated by law such as France or Thailand etc. You set 'Country Chart of Account' in the IMG Company Code Global Parameter setting, and you map country accounts in the 'alternative account' field of the each account master data. This master data mapping is done in company code level (table SKB1, B-segment, t-cd FSS0). So this is not making a reason to separate chart of accounts or controlling area. Another popular argument is about VAT codes and account setting. If you use the same VAT code, account setting is also shared and can not be decided for individual company, if the chart of account is shared. In some countries, you need to set different accounts for each VAT codes. This control ('Rule') is also inseparable, if the chart of account is shared. But these do not become critical because if you are in different country, you use different VAT codes, you won't have the conflict. This doesn't make reason to separate chart of accounts or controlling area, either. One thinkable downside with sharing Controlling Area is, creating cost element can affect other companies. For example, you don't have cost element for PPV, but new company code needs to analyze it in CO, but you can not create cost element because it affects all other companies. In case of parallel accounting, you have a choice from below 2 approaches. (X, Y, Z, D, as Retained Earning types.)

a. Parallel method (X + Y, X + Z) b. Restatement method (X + D, D = Y - Z)

I think a. parallel method is safer at any time. Because taking delta value of asset acquisition value between depreciation areas is only possible with a. parallel method. Jumping to separate controlling area or chart of account may seem easy solution, but you should take into account the swelling implementation and maintenance workload accompanying that. One shared system and the common business process may sound fancy policy, but that should not be used as a pretext to neglect individual local requirement. The usual headache in these cases is that dull and inexperienced consultant who is

incapable of foreseeing these sensitive and complex financial requirements, fails to choose elastic and versatile setup, twists users' arms into crippled system. Still, I don't subscribe to separate chart of accounts or controlling areas. In FI module, you have transaction currency and company code currency (local currency). You can see it when you post foreign currency transaction. For an international organization setting, it is popular to set parallel currency by using Company code additional currency in IMG, such as secondary local currency (LC2), 3rd local currency (LC3). LC2, LC3 are recorded for every financial entry (journal). These are optional setting. For LC2, LC3, you can choose exchange rate type (usually M) and the translation date, and whether to use Group currency or Hard currency or Index currency etc.

Group currency is something you set for the client (system environment). You can see it by t-cd SCC4 (table T000-MWAER). Hard currency or Index currency, these are what you define in the country code setting which currency to be used. You will need to define one ledger for hard currency or index currency.

LC1 (company code currency) should be national currency. No matter how your auditor says Measurement Currency should be the majority business transaction currency, LC1 (company code currency) should be national currency. Technically speaking, VAT report (GST report) allows alternative currency, but it translates at the exchange rate of the reporting date. Poor users, they had to run the reports for each months (12 times). Report run for one month takes 20-30 minutes!! If you use FIAA or Material Ledger, you can define Currency Profile. What you do is just assign group currency to one profile. You use it for Depreciation area of FIAA, or for Material Ledger. If you use New GL, you can still define additional currency in the Leading Ledger, and parallel currency for non-Leading Ledger. You assign these ledgers to each Depreciation areas. Regardless of this currency profile, currency translation in FI and ECCS/SEMBCS are completely independent. You can also use parallel currency in COPA. You can have Operating Concern (COPA) currency, and company code currency, and profit center currency if necessary. Profit center currency may be necessary if you use transfer price in profit center accounting. Today, I think it is popular to put company code in first 4 digits of profit centers, and plant in first 4 digits of cost centers (if PP/PC are used). However, there is one known issue about this company code specific profit center coding. If you use Intercompany Billing (Sales Doc Type IV) scenario, the sale takes place at the profit center of shipping plant, not selling party. You will need to do some user-exit development to correct this. One project I know, they use

company code independent profit center (global profit centers), they don't have this issue. So this should be taken into consideration when you decide on profit center coding rule (company code specific or independent). There is one more issue about this Intercompany Billing (Sales Doc Type IV). COGS entry in FI can be created together with group account payable by using IDOC. But the COGS in COPA is derived from material cost from the shipping plant, and that is converted to company code currency from shipping plant currency amount. One way to solve this is to do user-exit development so COPA to display material purchase price for the company code. For example you can check out / switch off cogs condition type by the user-exit routine of requirement field of pricing procedure. You can have another price condition which displays interco goods price by condition record. You assign them to copa value fields. Alternative is to give up using the Intercompany Billing scenario, and make use of individual purchase requisition from sales order instead. Sales order for the shipping party can be created from purchase order using IDOC. You can use STO.

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