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Historical exchange rate for Assets

Dec 06, 2017 at 05:55 AM

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Former Member

Our customer says, per IFRS (IAS21) when we purchase asset (material, service) we should use historical exchange rate if we made down payment for this asset (material, service).

We made down payment for asset in foreign currency. When asset is delivered and invoice is posted through MIRO, system takes the posting date's exchange rate. But our customer's requirement is system to take the exchange rate back at advance payment date.

Example

Down Payment - 01.01.2017 1 USD=1.5 AZN

Dr Prepayment (for asset) 1000 usd = 1500 azn

Cr Bank 1000usd=1500azn

Invoice Posting 01.07.2017 1USD=1.7 AZN

Dr Fixed Asset 1000 USD=1700 AZN (Requirement - this amount should be 1500 AZN)

Cr Payable 1000 USD=1700 AZN (Requirement - this amount should be 1500 AZN)

We have group currency implemented, so changing exchange rate manually during MIRO wont serve our purpose. I couldn't find standard configuration for historical exchange rate in invoice posting.

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2 Answers

G Lakshmipathi
Jan 18 at 02:33 PM
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The better option could be you do MIRO for full payment and subsequently, clear the down payment via F-54

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Former Member

Dear Lakshmipathi, thanks for you answer. Do you mean entering translation date manually in F-54? I dont think it helps, because in MIRO system takes posting date as a translation date. Our customer's requirement is to post to asset (or material, exoense) account with a historical rate in MIRO transaction.

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Shakeel Ahmed Jan 22 at 04:20 PM
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Hi Farid,

Exchange rate is picked based on Translation date. Now translation date is filled in three ways.

1. Posting Date = Translation Date (standard system)

2. Manual Input = Translation Date

3. Another way to fill the translation date by implementation of a BADI FI_TRANS_DRIVE_WWERT. This BADI is called by function module FI_DERIVE_WWERT (If this is helpful I can share full method as well, I have a document on this)

Don't change the rate manually, but get the translation date changed and system will pick the historic exchange rate from OB08 based on this translation date.

Regards

Shakeel

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Former Member

Dear Ahmed, thanks for you answer. I am also considering BADI for translation date. I wonder, if IFRS recommends to use historical rate when we receive down payments, why this procedure is not a part of standard system? System allows us to specify exchange rate manually, however it leads to incorrect amount in local currency 2 (group currency).

According to IFRS (IAS21, IFRIC22) using historical rate is true. Which date you take as a translation date in your country?

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