Dynamics Community Forum Thread Details

Comparing Month-End Account Balances (CAD vs. USD)

Hi:

In the legacy system, the transactions during the month were subject to the average monthly exchange rate. Then, the balance at month-end was subject to a revaluation entry.

Is it possible to conduct an average monthly exchange rate, in Business Central? Since I have not found a way to do this, I have configured Business Central to automatically pull in exchange rates on a daily basis.

Is the importing of daily exchange rates, then, the same thing as "spot rates"?

Also, does the "Adjust Exchange Rates" window accomplish the same thing as month-end revaluation?

We tested Adjust Exchange Rates in the sandbox.

Our expectation was that the month-end balance for January 2022 appearing in the USD bank account would be the CAD equivalent using the month-end spot rate. (I have been hoping that the daily exchange rates are the equivalent of spot rates.)

The balance at month-end, however, is closer to the USD bank balance than the CAD equivalent expected.

John

Hi John,

Spot rate to me, in terms of NAV/BC, is when you are entering a FCY transaction and you decide the exchange rate that populated from the exchange rate table needs to be adjusted so you go into the Change Exchange Rate page, and enter a spot rate for that transaction so it is the correct exchange rate for that entry. Importing the daily exchange rates from a service like FloatRates is populating the Currency Exchange Rate tables. These auto populate when entering transactions based on currency/date entered on the transaction. Then if the rate needs to be change, drill into the currency code to open the Change Exchange Rate page and enter a spot rate if needed. That's how I view it.

When adjusting the Bank Account using Adjust Exchange Rates batch job, the system is adjusting a cash balance. The change in cash balance is to reflect today's functional/local currency equivalent balance in the bank account by generating a realized gain/loss transaction. So it revalues the posted entries specified from the batch's adjustment date.

Here's a good thread that goes into detail on the adjustment of banks in NAV/BC.

community.dynamics.com/.../adjust-exchange-rates---bank-account---post-to-realised-gain-loss

I hope that helps.

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