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Dynamics 365 Community / Forums / Microsoft Dynamics GP (Archived) / Wanting to use Multicu...
Microsoft Dynamics GP (Archived)

Wanting to use Multicurrency in an existing environment

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Posted on by BryGuy 15

Hello, we have been using GP for many years and wants to start using the multicurrency features as we have just upgraded from GP10. 

We currently have a separate FX account that holds the foreign exchange per appropriate change.  See below for an example.

Account Description
138-0000- HSBC CA$
138-0000-FX HSBS CA$ FX
138-0001- HSBC US$
138-0002- RBC CA$
138-0002-FX RBC CA$ FX

What do you think the best option is to move forward with using the multicurrency functions and removing the current FX accounts? Can we do this in the existing company or do we need a new company? We have setup the tables and access.

Any insight will be helpful.

Regards,

Bryan

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  • Suggested answer
    MG-16101311-0 Profile Picture
    MG-16101311-0 26,225 on at

    You can enable multicurrency in the current company, go through the motions to set it up (create currencies, setup exchange tables, assign currencies to companies, and setup multicurrency accounts). You will also have to visit the company Multicurrency Setup and make the necessary changes there to determine what accounts will be used to track realized/unrealized gains, etc., and whether you want certain accounts revalued or not (AP and AR typically). I would do this all in a test company to ensure the outcome is what's expected.

    Finally, you will need to make any necessary changes to your MR reports to ensure you are accounting for assets, liabilities, revenue and expenses in accordance with your local accounting standards (sorry, I could not tell if you were in CA or the US).

  • BryGuy Profile Picture
    BryGuy 15 on at

    Hi Mariano, thanks for your reply. I have performed the steps you mentioned above, however, I am not sure the best approach to convert the functional balances into originating on a go forward basis. I will need to get the key accounts (chequebooks, AP, etc.) converted to full originating currency at a point in time and not have the system give me inaccurate average exchange rates at month end revaluation time because of balances entered in Functional/Originating currency.

    MR also will show the currency entered in originating currency if I tell it show the transactions in that currency  in the column format.

    I was thinking about creating a new company and starting fresh, but loose history. What are your thoughts on trying to do this within the current company vs. a new company?

    Regards,

    Bryan

  • twelvestrikes Profile Picture
    twelvestrikes 3,657 on at

    Hi Bryan

    After you have followed Mariano's steps to ensure MC is setup, you are correct that you now need to do something with the balances in the existing accounts to change them from functional amounts to an originating currency.

    Here is what I would do. I would do this at month end based on your revaluations being completed.  Lets use your account 138-0000 HSBC CAD and assume that it has a balance of DR $100 in it and the 138-0000-FX CAD  has a balance of CR 25.00

    Both of the accounts are in USD (assuming USD is the functional currency), so assuming that when you net the two accounts you get a balance of $75 USD (to be equal to $100 CAD).

    To fix this:

    Create a GL journal entry in USD

    DR  Clearing Account  100.00

        CR 138-0000 HSBC CAD   100.00

    this will give you a zero balance in your GL Bank Account

    Next create a journal entry in CAD using the exchange rate that you used at month end to give you the balances you are trying to change. My sample exchange rate is  .75 assuming a divide type. Be sure that your GL account is setup for posting in CAD.

    DR  138-0000    100.00

         CR  Clearing Account  100.00

    At this point you have now changed the GL bank account to reflect the originating currency of CAD @ $100 and the functional amount of  USD $75.00 based on the exchange rate.

  • BryGuy Profile Picture
    BryGuy 15 on at

    Thanks Jeffrey, much appreciated.

  • MG-16101311-0 Profile Picture
    MG-16101311-0 26,225 on at

    Sorry I couldn't get back to you earlier. Jeffrey's approach is correct.

  • BryGuy Profile Picture
    BryGuy 15 on at

    Hi Jeffery,

    After further review, what happens to the $25 in the 138-0000-FX account? How does this get cleared?

    Below are the actuals I have in my TB in Excel:

    GP
    @ Dec 31 2016
    Account Description US$
    138-0000- HSBC CA$ $716,618.14
    138-0000-FX HSBS CA$ FX ($182,903.88)
    138-0001- HSBC US$ $233,765.27
    138-0002- RBC CA$ $1,098,920.00
    138-0002-FX RBC CA$ FX

    ($280,479.54)

    Regards,

    Bryan

  • twelvestrikes Profile Picture
    twelvestrikes 3,657 on at

    Hi Bryguy

    Lets make sure we are both on the same page with this information. Looking at the HSBC account, is the $716,618.14 the USD equivalent amount or what should be the CAD amount?

    For the 138-0000-FX account, what are the entries you are booking?

    Looks like

    DR ?????

        CR   138-0000-FX

    thanks

  • L Vail Profile Picture
    L Vail 65,271 on at

    Hello BryGuy!

    Just in case it can be helpful, you might want to look at a blog post I did regarding multicurrency:

    http://dynamicsconfessions.blogspot.com/2014/06/setting-up-multicurrency.html

    It's a 'cheat sheet' I developed for a client who added multicurrency after many years of running GP. One thing I might add is that if you are running multiple companies with different functional currencies, be sure to create a set of Exchange tables with the other functional currency.

    Kind regards,

    Leslie

  • BryGuy Profile Picture
    BryGuy 15 on at

    Thanks everyone for your responses. To give you an update, we decided to create a new company and cutover starting fresh.

    A couple reasons:

    • We did not want to go back and reverse out transactions and re-enter in originating currency
    • It is a cleaner cutover for auditors and users (Old company vs. New company)
    • We decided change the chart of account structure and re-align accounts in the new created ranges (this could have been done in the old company using PSTL Account Modifier/Combiner but that processes looses what the accounts where originally and again, it was cleaner to start fresh)
    • We will combined multiple funds into one company as they are currently split out in different companies causing for higher maintenance
    • We will create new MR reports based on the ranges of accounts we want and then can work on creating translated financial statement showing both originating and functional. 

    Our next challenge will be identifying how to figure out the FX difference between Avg. and Current exchange rates within MC and pushing the difference to OCI and AOCI lines in MR. Bring on the advanced accounting and I will try to combine my knowledge of MR and accounting to make this happen... Any insights would be helpful!

    Thanks again.

    Bryan

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