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Settlement issue for customer

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Posted on by oldman.logan

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Hi. We are trying to make a settlement for a customer for goods delivered in 2018. We have a balance of SAR 27,051.01 between our invoice amount and the payment received from them. Since our customer did not respond to this, we have decided to write off.

Invoice amount = Euro 119,227.50 (original amount as per our currency SAR 553,179.83)

Payment 1 = SAR 257,014.75

Payment 2 = SAR 269,114.07

Difference= SAR 27,051.01

We are settling it in 2020, however about 22,000 goes to the exchange rate difference account even though the system has calculated the original amount SAR values from the exchange rate on that invoice transaction date in 2018. The payments are in SAR. Only about 5500 appears in the customer account as balance and the remaining lost to exchange rate difference.

Please let me know why this is happening and how it can be fixed.

Thanks in advance!

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Ludwig Reinhard Microsoft Employee on at

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RE: Settlement issue for customer

Hello Vijay,

Many thanks for all of the information.

The exchange rate gains/losses of approx. 22000 seem to result from the first two payments that have been made.

If the invoice is in EUR but the payment in SAR then the payment voucher must create a related foreign currency gain/loss if the exchange rate has fluctuated between the invoice date and payment date.

For me this sounds ok and reasonable.

Can you possible double check those amounts by making a control calculation in Excel?

Best regards,

Ludwig
oldman.logan 557 on at

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RE: Settlement issue for customer

Dear Junaid. Thanks for your reply. Yes, invoice in Euro, payment in SAR. The exchange rate difference appears when we are settling the invoice against the payment. When calculating the value of the exchange rate on the day of the transaction, the invoice of 119,227.500 Euro is being calculated as SAR 553,179.830 under original amount. That's fine for us and it is the correct exchange rate. Now we are just settling this against the SAR payments 257,014.750 and 269,114.070. The difference to customer account should be 553,179.83 - 257,014.75 - 269,114.070 = 27,051.01.

The exchange rate difference account shows 21,383.79 SAR after settlement of the two payments and our invoice, made on 01-01-20. Screenshot below.

The euro invoice voucher is as below: (Internal accounts use SAR since its our main currency. Secondary currency is USD. All transactions show the secondary currency USD value as a reference and it does not affect the transaction in anyway.)

I will check the link you provided. Thank you.
oldman.logan 557 on at

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RE: Settlement issue for customer

[quote user="Ludwig Reinhard"]
Hi,

What is your accounting currency?

Were the payments recorded in EUR, SAR or in another currency?

Can you share the payment vouchers including all related vouchers that have been created?

Many thanks,

Ludwig
[/quote]
Good Morning Dr. Reinhard. Sorry I confused on your earlier question. Our accounting and reporting currency are both SAR. Our Secondary currency is USD. The payment received was in SAR and recorded in SAR.

Open transactions under customer

Payment Vouchers

Secondary currency is USD.

The voucher of the invoice is as below
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Junaid Idrees 12,746 on at

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RE: Settlement issue for customer

Hi Vijay,

So your invoice was booked in EURO and payment booked in SAR. And your reporting currency is SAR.

I'm just wondering why system booked 22,000 SAR in exchange rate difference account. Did you check, was your exchange rate correct on the day when invoice was booked in EURO?

Also check your EURO invoice voucher, what reporting currency amount system showing you there?

In AX 2009, there is a screen "Exchange Adjustment" in AR 》periodic

tryst-with-dynamics.blogspot.com/.../exchange-adjustment-ax-2009.html
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Ludwig Reinhard Microsoft Employee on at

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RE: Settlement issue for customer

Hi,

What is your accounting currency?

Were the payments recorded in EUR, SAR or in another currency?

Can you share the payment vouchers including all related vouchers that have been created?

Many thanks,

Ludwig
oldman.logan 557 on at

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RE: Settlement issue for customer

Thanks for your reply Dr. Reinhard. The invoice is in EUR. EUR is just the currency that was used for the invoice to the customer. We sometimes use other currencies to invoice the customer based on their requirement like USD, EUR, GBP etc. SAR is our reporting currency. We don't see an option for the revaluation in AX 2009 system under GL -> periodic or AP -> periodic. Could you direct us, perhaps?
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Ludwig Reinhard Microsoft Employee on at

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RE: Settlement issue for customer

Hi,

Is the invoice in EUR or SAR?

Is EUR your accounting or reporting currency?

Have you run a foreign currency revaluation for this invoice? What was the result (voucher) generated?

Best regards,

Ludwig