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Dynamics 365 Community / Forums / Finance | Project Operations, Human Resources, ... / D365 Financial Reporte...
Finance | Project Operations, Human Resources, ...
Suggested Answer

D365 Financial Reporter and Translation of Retained Earnings

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Posted on by Dearbhla Deane 10

Hi all, 

I am running a balance sheet using Financial reporter from D365 (Finance & Operations) and the translation of my rolled forward retained earnings is not as expected. There have been manual journals migrated to the account so I'm not sure if this causing the issue. From another forum (See extract below) it seemed to suggest that this issue was resolved from Dynamics GP2015 onwards but perhaps D365 has reverted to the old limitations? Any suggestions?

Watch out for Retained Earnings. In versions of Dynamics GP prior to GP2015, the retained earnings account had to be assigned the Retained Earnings Account Category in order to translate properly and you had to be careful not to enter any journal entries to the retained earnings account because they would not be translated properly. Dynamics GP2015 has removed those limitations. Another thing to be aware of is that because retained earnings is translated at historical rates, in order for retained earnings to roll forward so that the translated balance is equal to the sum of prior year translated earnings plus current year earnings you must enter the average annual rate as the year end rate (12/31 for a calendar year end) in the historical exchange rate table.

Thanks,

Dearbhla

I have the same question (0)
  • Juanse Profile Picture
    Juanse 660 on at

    Hello,

    I think this has been an issue in D365. Per my experience the translation of RE is done by taking the cumulative balance and translating at the rate 12/31 of the prior year plus the sum of the current years 12/31 rate. In other words, it doesn't translate for example year 2018 at the historical rate, then 2019 at the historical rate, then 2020 at this years rate and then sums them all up to come up with the total. The solution has been as stated above, to have a historical rate assigned to RE, manually calculating the cumulative average and assigning to the historical rate type created just for RE.  

    Hope this makes sense.

  • Dearbhla Deane Profile Picture
    Dearbhla Deane 10 on at

    Many thanks for your reply. I have a historical rate table assigned to RE and have calculated the cumulative average rate and added this to the historical rate table as at 12/31. However when I run the report as of Jan 2020 it is only picking up the 2019 retained earnings amount and not the rollforward amount from the P&L account. The 2019 retained earnings amounts are purely migrated balances which were manually posted to the retained earnings account. (We only started using D365 in 2019 and migrated our historical data into the system via manual journals)

    I have also run the report in functional currency and the roll forward and retained earnings are as expected. As such this seems to be an issue with the translation for some reason (all other balances are translating as expected).

  • Juanse Profile Picture
    Juanse 660 on at

    Hi,

    For the years before 2019, have you ran year end closings for the years before 2019?

    regards,

  • Dearbhla Deane Profile Picture
    Dearbhla Deane 10 on at

    There is no data for the years prior to 2019

    Thanks

  • Suggested answer
    Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at

    Hello Dearbhla,

    Is it possible that you open a support request with MS and report this as a bug?

    I think that this one needs to be fixed to get correct financial reports out of the system.

    Would be great if you could do that and keep us updated how things are going.

    Many thanks and best regards,

    Ludwig

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