New Programs in the Closing Operations

The closing operations in FI affect

‰ The foreign currency valuation of open items and monthly
balances (SAPF100> FAGL_FC_VALUATION),
‰ Translation (FAGL_FC_TRANSLATION)
‰ Grouping (SAPF101 > FAGL_CL_REGROUP),
‰ Other valuations (old: SAPF107V, SAPF103 and SAPF104)
‰ WE/RE accounts clearing (old: RFWERE00).
‰ Balance carry-over (old: SAPFVGTR)

Balance sheet and P&L adjustment (SAPF180 and SAPF181) are

removed.

The valuations are generally made via a valuation area.

© SAP AG 2004
 The Valuation Area

Assignment in Customizing:

Valuation Area > Accounting Principle > Ledger Group

1 : 1 : 1

The valuations are performed per valuation area.

The valuation area controls the account determination and the

valuation method (only FAGL_FC_VALUATION)
and thus the determination of the exchange rate type.

The Accounting Principle determines the Ledger Group. This

concerns FAGL_FC_VALUATION, FAGL_FC_TRANSLATION,
FAGL_CL_REGROUP and SAPF107V.

© SAP AG 2004
 Open Items Valuations

The most important changes are:

„ The history is recorded in table FAGL_BSBW_HISTRY
„ No more “updates” to valuated items (BDIFF)
Always: Adjustment posting and reversal posting
„ No consideration of RDIFF at the time of the valuation
„ Default: Remeasurement procedure according to FASB52 / IAS21.
(refer to the example on the next slide)
„ Transfer of the valuation differences to CO (always when valuation
accounts are created as a cost element)

© SAP AG 2004
 Remeasurement

Example: LC1 = EUR LC2 = USD

Posting to be evaluated:
Amount TC Amount LC1 Amount LC2
100 CAD 160 EUR 120 USD (Posting exchange rate: 1 EUR = 0.75 USD)

Valuation for the exchange rate 1 CAD -> 1.50 EUR TYPE M
1 EUR -> 1.20 USD TYPE B on
s i
v er nt)
ERD amount TC ERD amount LC1 ERD amount LC2
c on eme
0 -10 -12
r e ct sur
Di mea
(r e
Comment:
The calculation (TYPE B) of the valuation amount LC2 (-12) is not carried out from
the conversion of the posting amount LC1 (160 EUR),
That would be:
160 x 1.20 = 192
192 – 120 = + 72 (calculated exchange rate difference)

but from the direct conversion of the valuation amount LC1 (-10 x 1.20) to the
valuation amount LC2 (-12). Also TYPE B.

© SAP AG 2004
 Is Remeasurement Always Used?

Example: Countries with high inflation

„ During posting, LC2 and LC3 are usually both determined by
conversion from LC1.
„ No remeasurement, if it is specified in Customizing (OB22) that LC2
or LC3 is to be converted from the transaction currency during the
posting ( TC: 100 CAD)
(switch value 1, relevant for countries with high inflation because
TC1 is subject to a strong influence from inflation).

„ Time of the valuation:

If switch value 1 is set, then no update to ERD-LC2 or ERD-LC3,
because the conversion from the ERD-LC1 posting amount would
not be meaningful.
(Refer to the example on the next slide).

© SAP AG 2004
 No Remeasurement, if...

Example: LC1 = EUR LC2 = USD

Posting to be evaluated:
Amount TC Amount LC1 Amount LC2
100 CAD 160 EUR 120 USD (Exchange rate: 1 EUR = 0.75 USD)
Valuation for the exchange rate 1 CAD -> 1.50 EUR TYPE M
1 EUR -> 1.20 USD TYPE B e nt
re m
ERD amount TC ERD amount LC1 ERD amount LC2 asu
0 -10 no entry eme
o r
N

Comment:
ERD-LC1 (-10) is determined “normally”, ERD-LC2 is not determined, because LC1
for example, represents a high inflation currency, which would not be very
meaningful for the determination of ERD-LC2.
In this case an extra run is conceivable, which specifically determines ERD- LC2
from the comparison of posting–TC und - LC2 and the valuation exchange rate
CAD – USD.

© SAP AG 2004
 Balance Valuation

Initial situation: 2 documents posted in foreign currency USD: FC= Foreign currency, TC = Transaction currency

Document 1: Post.date 01/01/2005 , Posting exchange rate: 0.8

Account TC :USD LC: EUR Segment

Bank clearing 400 - 320 - S1

Bank 400 320 S1

Document 2: Post.date 02/01/2003, posting exchange rate: 1.1

Bank clearing 600 - 660 - S2

Bank 600 660 S2

Account balance after posting Bank Bank clearing

400 / 320 S1 400- / 320- S1
600 / 660 S2 600- / 660- S2

Different segment values (company code oriented or

segment oriented value determination):
Balance valuation account bank for 03/31/2005, valuation rate 0.9

e d
Valuation per account: TC 1000
Valuation amount:
LC 980
900
Valuation per segment
Segment 1 TC 400 r t LC 320
Valuation difference: - 80 Valuation amount:
p o 360

>Segment distribution at the ratio 400 : 600 >

Valuation difference S1:
u p + 40

Valuation difference S1: - 32 Segment 2

t sTC 600 LC 660 - 80

no
Valuation difference S2: - 48 Valuation amount: 540
Valuation difference S2: - 120
Preferred
© SAP AG 2004
 Translation (FASB52/IAS21)

FAGL_FC_TRANSLATION
Evaluation of balance sheet/P&L areas (example: reporting currency TC2 USD)
1. Translation happens at totals level (possible for all types of G/L accounts)
2. Account determination happens via valuation area and financial statement version

Example:
TC1 EUR TC2 USD
Orig. document 160 120
Remeasurement -10 -12
________ ________
Account balances 150 108

Translation: What is the value of LC1 (EUR) in reporting currency (USD) per key date?
(LC1 evaluated with key data exchange rate 1 EUR = 1.20 USD)
(150 X 1.20 = 180) Í value to be achieved
Required adjustment posting + 72 to get key date value

„ Asset accounts are evaluated with the historical exchange rate, P&L accounts are
evaluated with the weighted exchange rate (corresponding exchange rate type in
table TCURR must be maintained).

© SAP AG 2004
 Regroup Customers with Credit Balances etc...

Initial situation:

Receivables
_______________________

50 – S1

50 S2

100 - S3

Transfer posting customer with credit balance

a) Company code view/without segment examination

Receivables Correction Payables Segment reports not possible

100 100-

b) Company code view / with segment examination Preferred solution!

Receivables Correction Payables Company code determines the
50 S1 50- S1 depiction of accounts.
50- S2 50 S2
100- S3
Positive payables (50,– S2)
100 S3
are accepted
c) Without company code view/segment examination only
Receivables Correction Payables
Total payables (150-)
50 S1 50- S1
do not correspond to the
100 S3 100- S3 company code view (100-)
© SAP AG 2004