Profit/Loss on Foreign Currency {FPMM-8}

The option is used to calculate and create foreign currency profit or loss transactions to account for exchange differences.

• When preparing annual financial statements provision should be made for foreign currency profits or losses in terms of GAAP. Foreign currency creditors balances as at year-end should be provided for at a rate as prescribed by GAAP, which can result in a currency profit or loss.
  

• A foreign currency creditors account in foreign currency may be settled but because of currency changes the local value is not zero (0)

Before the option can be run the user needs to create two transaction types linked to the events F4 and F5. The credit GLA account is mandatory on the event F4 Transaction Type and the debit GLA account is mandatory on event F5 Transaction Type.  The other leg of the entry will be obtained from the account type definition.  Profits and/or losses are calculated for a creditor per account type and the calculated profit or losses are inserted when run in final mode using the document type PD and LC.  The user can view the document using {FPMO-9}, the drill down function on the document.
 

• Procedures:
• None