Hi
I am afraid I do not understand your requirement !
My earlier mail related to an explanation of SAP behavior ( relating to
accounting principles) with regard to pre-configured settings for Foreign
currency valuation .
I um unable to figure out what you want to check.....If you can be more
specific about your requirement, I shall strive to be of more help, I
assure.
Regards
Vidhyadhar
On Mon, Jul 26, 2010 at 1:55 PM, virji_guruji via sap-acct <
sap-acct@groups.ittoolbox.com> wrote:
> Posted by virji_guruji(SAP FI/CO Sr. Consultant)
> on Jul 26 at 4:22 AM hi
>
>
> what should i check in the same ? SAP configuration or ?
>
>
>
> --- On Mon, 26/7/10, VidhyaDhar via sap-acct <sap-acct@
> Groups.ITtoolbox.com> <http://Groups.ITtoolbox.com%3E> wrote:
>
>
> From: VidhyaDhar via sap-acct <sap-acct@Groups.ITtoolbox.com><http://Groups.ITtoolbox.com%3E>
> Subject: Re: [sap-acct] Foreign Currency Valuation in SAP
> To: "virji_guruji" email@removed
> Date: Monday, 26 July, 2010, 12:05 AM
>
>
> Posted by VidhyaDhar (User-friendly SAP FI Consultant)
> on Jul 26 at 12:00 AM Mark as helpful
> Hi Friends
>
> I tried to simulate the issue which I had posed earlier regarding Foreign
> Currency Valuation and I had used the lowest value principle .
>
> I posted a customer invoice for 1000 USD ( Local currency EUR ) and
> simultaneously I posted a Vendor Invoice on the same day for 1000 USD. The
> currency rate fluctuated on the date of Foreign Currency Valuation and
> theoretically a loss occurred with regard to my customer invoice ( My
> customer would be paying 500 EUROS lesser ) and a profit occurred with
> regard to my vendor invoice ( where I needed to pay 500 Euros lesser ).
>
> The SAP system is intelligent enough to book losses only ( arising out of
> the lesser sum my customer would pay ) and ignore the virtual gain ( where
> I
> theroetically need to pay to my vendor 500 Euros lesser ). I ran the
> Foreign
> Currency Valuation run once only , including both my customer as well as
> vendor items in the same run.
>
> Since I had used the lowest value principle, the system was smart enough to
>
> book a loss with regard to my collectibles and at the same time ignore the
> virtual gain which happens with regard to my vendor payable item.
> Therefore,
> the system does not thwart the accounting principle, it has been proved.
>
> I thought I could share this information with everybody interested to know.
>
>
> Thanks to you all friends.....and a special word of thanks to Roy and
> Sanjay.
>
> Regards
>
> VidhyaDhar
>
> On Mon, Jul 26, 2010 at 9:08 AM, VidhyaDhar via sap-acct <
> sap-acct@groups.ittoolbox.com> <http://groups.ittoolbox.com%3E> wrote:
>
> >
> > Posted by VidhyaDhar (User-friendly SAP FI Consultant)
> > on Jul 25 at 11:37 PM
> > Hi Sanjay
> >
> > Thanks for your views.
> >
> > Of course there are two different exchange rates in India ( one for
> Export
> > and one for import ). Do I imply that you have two valuation methods
> which
> > are assigned ( one for imports and one for exports ) and two separate F C
>
> > valuation runs need to be made ( one for booking losses and another for
> not
> >
> > booking profits ) ?
> >
> > I am asking this because if both customer and vendor dues are valuated in
> a
> >
> > single run ( which uses the same valuation procedure ) then both losses
> and
> >
> > gains can be booked (eg. if customer open items book a loss then
> > automatically vendor open items would book a gain or vice versa ) ? Or is
>
> > the SAP system tailored enough to book losses and ignore profits ,
> assuming
> >
> > that I use the lowest vaue principle ?
> >
> >
> > Regards
> >
> >
> > On Sun, Jul 25, 2010 at 9:40 PM, Sanjay-t via sap-acct <
> > sap-acct@groups.ittoolbox.com> <http://groups.ittoolbox.com%3E> <
> http://groups.ittoolbox.com%3E> wrote:
> >
> > > Posted by Sanjay-t
> > > on Jul 25 at 12:56 PM Hello
> > > VidhyaDhar,
> > >
> > > Nice to see your post on grilling the basic nature of accounting.
> > >
> > > 1. In India, based on CBEC has two different exchange rate for Import
> and
> >
> > > Export.
> > >
> > > 2. I am not sure but Roy can you clarify there is option while
> > revaluation
> > > where we can give forex gain and losses account separately, Wherein if
> it
> > is
> > > loss we can use P/L and if it profit ahhh we shall keep it Balance
> sheet
> > and
> > > make reversal entry on the next day.
> > >
> > > The very nature of law of conservatism can be achieved on a click.
> > >
> > > Regards,
> > > Sanjay.
> > >
> > >
> > >
> > >
> > >
> > > ---------------Original Message---------------
> > > From: VidhyaDhar
> > > Sent: Saturday, July 24, 2010 1:15 PM
> > > Subject: Foreign Currency Valuation in SAP
> > >
> > > > Hi Friends
> > > >
> > > > Foreign Currency Valuation is performed using a valuation method
> which
> > > includes a single procedure such as Lowest Value Principle . If my
> > company
> > > code were to revalue my receivable open items and there is an
> unfavorable
> >
> > > drop in exchange rate , I end up booking a loss arising out of such a
> > drop
> > > and I can understand the logic of conservatism being used. However , if
>
> > on
> > > the same day I were to revalue my payable open items using the same
> > > procedure, Would I not be ending up booking a profit ? If the lowest
> > value
> > > procedure results in booking a profit, then isn't the premise of the
> > > valuation procedure conforming to conservatism principle lost ?
> > > >
> > > > Example Customer Invoice raised for 1 USD = 45 INR on 01 Jan 2010
> > > >
> > > > Upon revaluation (using lowest value principle) at the time of
> closing
> > (
> > > viz. 31 Jan 2010) the exchange rate is 42 INR - then I would book a
> loss
> > of
> > > 3 INR , which is perfectly understandable.
> > > >
> > > > However, if I had a Vendor Invoice for 1 USD = 45 INR on 01 Jan 2010
> > > >
> > > > Upon revaluation using the same principle on 31 Jan 2010, My
> liability
> > > comes down by 3 INR leading to my booking a profit of 3 INR.
> > > >
> > > > If the system allows me to book profit using lowest value principle,
> > then
> > > isn't the premise of conservatism underlying the lowest value principle
>
> > lost
> > > ? Does not the very nomenclature of lowest value principle becomes
> > > questionable ? Or Am I missing out something and comprehending things
> > > incorrectly?
> > > >
> > > > Would appreciate your expert opinions, please
> > > >
> > > > Thanks in Advance
> > > >
> > > > Regards
> > > >
> > > > VidhyaDhar
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