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Dynamics 365 Community / Forums / Finance | Project Operations, Human Resources, ... / Preventing and Correct...
Finance | Project Operations, Human Resources, ...
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Preventing and Correcting Unexpected FX Revaluation in Ledger Settlement

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Posted on by ST-13020852-0 36

Issue :

  • In our USD company, we posted a GBP debit transaction in June 2023.
  • We later cleared it in USD in September 2023 using Ledger Settlement.
  • When we ran the 31/12/2023 FX revaluation, no adjustment was posted, as expected.
  • However, after running the Opening Transactions function in 2024, the GBP amount was brought forward, even though its USD equivalent had already been cleared.
  • When we ran the FX revaluation on 01/02/2024, the system unexpectedly recalculated the USD equivalent of GBP and posted an FX adjustment.

Our Questions:

📌 How can we prevent this issue in the future so that no unnecessary FX adjustments are posted after the opening transactions?
📌 What is the correct corrective action in 2024 to fully clear the transaction and ensure accurate financial reporting?

Categories:
Microsoft Dynamics AX
  • ST-13020852-0 Profile Picture
    ST-13020852-0 36 on at
    Preventing and Correcting Unexpected FX Revaluation in Ledger Settlement

    Hello everyone,

    I’m facing an issue with ledger settlement and the handling of opening transactions in a multi-currency environment, and I’d appreciate any insights on whether the suggested approach is correct.

    Scenario:

    • My company’s accounting currency is USD.
    • I posted a General Journal in SGD on 01/06/2024:
      • Dr Prepayment (Balance Sheet Account)
      • Cr Bank
    • Later, I cleared the entry on 01/09/2024:
      • Dr Expense Account (Profit & Loss)
      • Cr Prepayment (Balance Sheet)
    • I then used Ledger Settlement to match these transactions.
    • After this, my Trial Balance for 2024 correctly shows a 0 balance.
    • When I ran the Opening Transactions functionality for 2025, the system brought forward both transactions as follows:
    Date Year Closed Type Currency Amount in Transaction Currency Accounting Amount Amount in Reporting Currency
    01/01/2025 No Opening USD -531 -531 0
    01/01/2025 No Opening SGD 752.15 531 0

    Suggested Fix:

    It was recommended that I:

    1. Use Ledger Settlement during the year to match transactions.
    2. At year-end, create a manual journal entry to reverse and repost with a manually adjusted exchange rate to avoid issues with opening balances.

    Question:

    • Is this the correct approach?
    • Would there be a better way to handle this scenario to ensure that opening balances don’t bring forward unmatched FX differences?
    • How do you typically handle this type of multi-currency opening transaction issue
  • ST-13020852-0 Profile Picture
    ST-13020852-0 36 on at
    Preventing and Correcting Unexpected FX Revaluation in Ledger Settlement
    -Why did the system bring forward the transactions  even though they were settled  before year-end?
    -Is this standard behavior for the Opening Transactions function, and how does it determine which balances to carry forward?
    -What is the best way to prevent this from happening in the future to ensure no incorrect FX adjustments are posted?
  • BillurSamdancioglu Profile Picture
    BillurSamdancioglu 17,153 Most Valuable Professional on at
    Preventing and Correcting Unexpected FX Revaluation in Ledger Settlement
    You can dısable the feature of FX calculatıon on settlement but ın thıs case non wıll be calculated.
  • ST-13020852-0 Profile Picture
    ST-13020852-0 36 on at
    Preventing and Correcting Unexpected FX Revaluation in Ledger Settlement
    Here is a screenshot of the postings done.
    as you can see the first two postings were settled between them in 2023
     
     
     

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