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Dynamics 365 Community / Forums / Small and medium business | Business Central, N... / Consolidation Transala...
Small and medium business | Business Central, N...
Suggested Answer

Consolidation Transalation Method

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Posted on by PM-27041506-0 41

Hi Everyone, 

I am seeking guidance on the Consolidation process in Business Central. I am trying to prevent the system from translating the Retained Earnings account using the Average Rate.

Requirement:
I need the Retained Earnings balance to remain at its historical value without being revalued by exchange rates during consolidation.

  • Opening Balance: -10,000 USD

  • 2025 Movement: -12,000 USD

  • Expected Consolidated Balance: -22,000 USD (Exact match)

Current Issue:
Despite setting the Consolidation Translation Method to Equity (and trying Composite) on the G/L Account card, the system continues to apply the Average Rate during the consolidation run.

Questions:

  1. Which specific Translation Method should be used to ensure no exchange rate adjustment is applied to this account?

Categories:
Dynamics 365 Business Central
I have the same question (0)
  • Suggested answer
    Valentin Castravet Profile Picture
    Valentin Castravet 32,208 Super User 2026 Season 1 on at
    The equity and composite translation methods use the average rate so that's working how it was designed to. You should select and use the historical rate instead. 
     
     
     
  • Suggested answer
    OussamaSabbouh Profile Picture
    OussamaSabbouh 12,965 Super User 2026 Season 1 on at
    Hello,
     
    This is expected behavior in Business Central: there is no translation method that fully bypasses currency translation during consolidation. For Retained Earnings, the correct and only supported setup is Translation Method = Historical Rate on a Balance Sheet / Equity account, but this works only if valid historical exchange rates exist for the original posting dates; otherwise BC silently falls back to Average Rate, which explains your issue. Equity or Composite do not prevent revaluation, and BC cannot keep foreign-currency balances “as-is” without translation — it always requires a rate. To get the exact consolidated balance, you must ensure proper historical exchange rate data is available; there is no “no translation” option in standard BC.
     
    Regards,
    Oussama Sabbouh
  • Suggested answer
    Dhiren Nagar Profile Picture
    Dhiren Nagar 2,898 Super User 2026 Season 1 on at
    Hi,
     
    In the consolidation method, Average, Equity and composite method performs same conversion, just the accounting is different.
     
    If you want historical rater conversion use - Historical Rate method.
     
    However you can not achieve No conversion unless the currency of current company and consolidation company is same.
     
     
    Regards,
    Dhiren.

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