Table of Contents

Bank Account Exchange Rate Adjustment

In compliance with Polish legal regulations, the value of cash withdrawals made in a foreign currency from cash desks and bank accounts should be calculated based on the exchange rate applied for the cash receipts paid in the same foreign currency to the cash register or bank account.

This means that the equivalent of the cash withdrawal amount in a local currency should be calculated based on the exchange rate used for the relevant cash receipt amount. This process is very similar to the way inventory is valued, and the methods for settling cash withdrawals against cash receipts are essentially the same as the ones used for inventory, i.e. FIFO, LIFO, weighted average, where FIFO is the most commonly used method.

This approach is used in Polish Localization when calculating the value of cash payments in a foreign currency.

G/L Account Setup for Realized Positive and Negative Exchange Rate Differences

The functionality allows you to post gains or losses resulting from realized exchange rate differences to G/L accounts that have been defined for a given currency. To set up G/L accounts:

  1. Choose Lightbulb that opens the Tell Me feature icon, enter Currencies, and then select a related link.

  2. On the Currencies page, select the currency of the bank account for which the Adjust Bank Acc. Exchange Rate action is to be run. Then fill in the following fields:

    • Realized Gains Acc. - Specify the number of the G/L account to which the positive exchange rate differences that appear after the Adjust Bank Acc. Exchange Rates action is run.
    • Realized Losses Acc. - Specify the number of the G/L account to which the positive exchange rate differences that appear after the Adjust Bank Acc. Exchange Rates action is run.

Source Code Setup

The functionality allows you to set up a dedicated source code with which the entries will be posted when the Adjust Bank Acc. Exchange Rates action is run. . To configure the source code for bank account exchange rate adjustment:

  1. Choose the Lightbulb that opens the Tell Me feature icon, enter Source Code Setup, and then select a related link.

  2. On the Source Code Setup page, on the General FasTab, fill the Bank Account Exchange Rate Adjustment field with the source code defined appropriately.

Adjusting Bank Account Exchange Rates

To recalculate reversed cash amounts in a currency, that is, to calculate and post the realized exchange rate differences that result from the application of the correct cash valuation:

  1. Choose the Lightbulb that opens the Tell Me feature icon, enter **Bank Accounts, and then select a related link.

  2. On the Bank Accounts page, select the line with the bank account, then choose Edit or View.

  3. On the Bank Account Card page, select the Adjust Bank Account Exchange Rate action.

Note

The Bank Account Exchange Rate Adjustment report can be run directly by using the Tell me feature. To run the report, select the Lightbulb that opens the Tell Me feature and enter Correct Bank Account Exchange Rate, then select the related link.

  1. On the report page, on the Options FastTab, fill in the appropriate fields:

  • Bank Account No. Filter - Specify the bank account for which you want to adjust the exchange rate. Leaving the field blank means that all bank accounts with the Currency Code field that contain values will be revalued.

  • End Date - Specify the end date of the period in which the transactions subject to revaluation were posted (including the cash receipts that has been settled).

Note

If the report is run from the Adjust Bank Acc. Exchange Rate page, the appropriate bank account number from which the report was run and the working date defined in the system by the user are automatically entered in the above fields.

  • Posting Description - Specify a description for the transaction, which will be copied to the general ledger and subsidiary ledger entries when posting bank account exchange rate differences.

  • Document No. - Specify the document number with which the exchange rate differences will be posted in the general ledger and subsidiary ledger entries.

  • Test Mode - The field is selected by default. This means that the report will be run in test mode, as a result of which the exchange rate differences will be calculated and displayed in the report, but will not be posted. If the field is not selected, the exchange rate differences will be simultaneously calculated, posted and displayed in the report.

  1. To run the report, select Print or View Preview and close. The effect depends on the settings in the Test Mode field:

    • the Test Mode field and Print option selected - the exchange rate differences will be calculated and a test report will be printed before posting;

    • the Test Mode and Preview & Close option selected - the exchange rate differences will be calculated and a test report will be displayed before posting;

    • the Test Mode field not selected and the Print option selected- the exchange rate differences will be calculated and posted and the posting report will be printed;

    • the Test mode field not selected and the Preview & Close selected - the exchange rate differences will be calculated and posted and the posting report will be displayed.

Valuations are not posted directly to the general ledger for each bank account ledger entry. When the exchange rate is adjusted, an accounting buffer is created that combines the adjustment entries (the combination is made according to the posting date, the G/L account assigned for the realized exchange rate gain or loss, and the dimensions used).

Note

Only the entries that have not been reversed are included for exchange rate adjustments. If a transaction contains an error, the entry should be reversed by using the standard Reverse Transaction function. Such an entry that is reversed both as a cash receipt and a withdrawal will not be included in the valuation.

The posting date of the exchange rate difference is the same as the posting date of the bank account ledger entry for which the difference was calculated. If the posting date of a bank account ledger entry is within a period that is closed for postings (i.e., earlier than the first allowed posting date), the date is moved to the first allowed posting date. The first allowed posting date is defined as the date in the Allow Posting From field on the General Ledger Setup page.

Note

Date-related settings configured on the User Setup page are not included.

Adjustment entries are automatically posted when you run the Adjust Bank Account Exchange Rate report. Within Polish Localization, functionality has been added to check whether a new unapplied entry has been created between applied entries. If such an unapplied entry has been created, when the report is run, the values that have been posted are reversed and exchange rate adjustments are recalculated for open entries.

Manually Adjust Bank Account Exchange Rates

In some cases, it is necessary to exclude specific bank account ledger entries from the automatic revaluation of cash withdrawals in a specified currency. “To exclude” means that a given entry is combined with an entry that contains the same amount, but the amount has the opposite sign.

To manually adjust the exchange rate for a bank account:

  1. Choose the Lightbulb that opens the Tell Me feature icon, enter Bank Account Ledger Entries, and then select a related link.

  2. On the Bank Account Ledger Entries select the line that you want to correct, and then run the Apply Entries action.

Note

The amount in the selected entry to be adjusted should be positive.

  1. On the Apply Bank Acc. Ledger Entries page:

  • Fill in the Posted Document No. field to specify the document number for which the exchange rate differences will be posted in the general ledger and subsidiary ledger entries.

  • Fill in the Posting Description field with a description for the transaction, which will be copied to the general ledger and subsidiary ledger entries when posting bank account exchange rate differences.

Note

By default, the above fields are filled in based on the bank ledger entry that we want to apply.

  • Select the line to be applied, and then select it by choosing the Set Applies-to ID action.

  • Select the Post Application to apply the entries data.

  1. The selected entries will be applied with each other and will not be included in the further calculation of bank account exchange rate adjustments. Both entries will be marked as Applied Manually on the Bank Account Ledger Entries page.

Unapply Manually Adjusted Bank Account Exchange Rates

To unapply the bank exchange rate entries that were manually applied:

  1. Choose the Lightbulb that opens the Tell Me feature icon, enter Bank Account Ledger Entries, and then select a related link.

  2. On the Bank Account Ledger Entries page select the line that you want to adjust and then run the Unapply Entries.

Note

The amount in the selected entry to be adjusted should be positive. In addition, the entry should be marked as Applied Manually.

Important

When you unapply entries and then rerun the adjustment of bank account exchange rates, relevant entries will be applied automatically.

Checking how the Valuation for Bank Account Ledger Entries Was Applied

After posting the exchange rate differences that result from the valuation of bank transactions, the posted entries can be verified.

To see which entries have been applied with each other:

  1. Choose the Lightbulb that opens the Tell Me feature icon, enter Bank Account Ledger Entries**, and then select a related link.

  2. On the Bank Account Ledger Entries page, select the line for which you want to check the application, and then choose the Entry action and the Show Bank Acc. Exchange Rates Applied Entry action.

  3. On the Bank Acc. Exchange Rate Application Entry you can review the entries that were used to apply the entry and the amounts applied.

Printing a Valuation Report of Bank Account Ledger Entries

To print the Adjust Bank A report that shows the details of source entries and exchange difference entries, including the exchange rate, the amounts of the calculated exchange difference, and information on which entries have been settled and to which entries the exchange differences have been posted:

  1. Choose the Lightbulb that opens the Tell Me feature icon, enter **Bank Accounts, and then select a related link.

  2. On the Bank Accounts page, select the line with the bank account, then choose Edit or View.

  3. On the Bank Account Card page, select Bank Account Exchange Rate in the Reports menu.

Note

You can also run the report directly from the Tell Me function. To do so, select the Lightbulb that opens the Tell Me feature icon, enter the Bank Account Exchange Rate, and then select the related link.

  1. On the report page, on the Options FastTab, fill in the fields as expected:
  • Bank Account Filter - Specify the bank account for which you want to receive information about the adjusted exchange rate. If the field is blank, the report will be displayed for all bank accounts for which theCurrency Code field has been filled in.
Note

If the report is run from the Bank Account File page, the corresponding bank account number for which the report was run will be entered automatically in the Bank Account Filter field.

  • Show Reversed Adjustment - Select this field if reversed adjustment entries are to be shown.

  • Start Date - Specify the period start date to limit the range of posted bank account entries that have been adjusted with an exchange rate consistent with the valuation method used and accounted for during the period by calculating the exchange rate difference.

  • End Date - Specify the period start date to limit the range of posted bank account entries that have been adjusted with an exchange rate consistent with the valuation method used and accounted for during the period by calculating the exchange rate difference.