how to make peoplesoft 9.2 multi- currency work for...

How to Make PeopleSoft 9.2 Multi-Currency Work for You

Presented by:

Stephen Coco

Managing Director

SpearMC Consulting

Session ID#: 100220

@SpearMC

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Welcome and Please:

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How to join PeopleSoft Lifecycle Asset Management SIG.

Login to http://www.questdirect.org/

Go to http://www.questdirect.org/groups/PeopleSoft%20Asset%20Lifecycle%20Management

Click “Join Group”

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http://www.questdirect.org/

http://www.questdirect.org/groups/PeopleSoft Asset Lifecycle Management

Introduction

Multi-Currency Configuration

Multi-Currency Journals

Re-Measurement

General Ledger Adjustments

Reporting

Multiple GAAPs

Agenda

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About SpearMC

PeopleSoft Financials and Supply Chain Management

PeopleSoft Human Capital Management and Payroll

ERP Architecture and Application Development

Project and Program Management (PMO)

Change Management

ERP Training

Mobile Technology

About SpearMC

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Founded in 2004, SpearMC is a technology and

professional services firm specializing in

We focus on local market delivery and capability development in line with industry focus areas unique to the regions we serve.

Our local and well-connected network of top-tier business analysts, technical leads, developers and project managers keep travel cost to a minimum.

About SpearMC

7

Regional offices in Chicago, Oklahoma City,

Seattle and San Francisco

We focus on local market delivery and capability development in line with industry focus areas unique to the regions we serve.

Our local and well-connected network of top-tier business analysts, technical leads, developers and project managers keep travel cost to a minimum.

About SpearMC

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A decade of sustained and focused growth.

About SpearMC

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Each member of our Leadership Team

leverages over 20 years of experience in

Technology, Financial and Business

Transformation.

Energy

Transportation

Healthcare/Biotech

Government

Media/Technology

Consumer Products

Financial Services

Higher Education

About SpearMC

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Industry focus areas include:

Gold Level Partner

PeopleSoft Specialization

Applications Reseller

Hardware Reseller

About SpearMC

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Oracle Gold Partner since 2008:


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Common Terms

■ Currency Codes

▪ Pound Sterling (GBP)

▪ Mexican Pesos (MXN)

■ Exchange Rates

■ Market Rates (exchange rates, interest rates, stock price, etc.)

■ Currency Rate Types (Average, Current, Historical, etc.)

■ Base Currency (each Business Unit must have one base currency)

■ Foreign Currency (any currency that is not base currency)

■ Reporting Currency (any currency you use for reporting)


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Market Rate


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Loading Market Rates

■ PeopleSoft comes delivered with standard currency codes, however,

if a particular code does not exist then:

‒ Insert currency into CURRENCY_CD_TBL

‒ Insert currency quotation method into CURR_QUOTE_TBL

‒ Insert market rate definition into RT_RATE_DEF_TBL

■ Update Rates for existing currency code:

‒ Insert market rate for current effective period into RT_RATE_TBL


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Loading Market Rates

Rate File

New Currency

CURR_QUOTE_TBL

RT_RATE_TBL

CURRENCY_CD_TBL

RT_RATE_DEF_TBL

NO

YES

Note: Can use Excel to Component Interface


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Currency Quotation Method■ Indirect

‒ Determine whether you want the rates for a currency pair quoted

indirectly.

‒ For example, in converting United States dollars (USD) to Swiss Francs

(CHF), an indirect quote would indicate that USD x.xxxx = CHF 1

■ Direct

‒ Determine whether you want the rates for a currency pair quoted directly.

‒ For example, in converting United States dollars (USD) to Swiss Francs

(CHF), a direct quote would indicate that USD 1 = CHF x.xxxx. In this

case, Swiss Francs are quoted directly against the United States dollar


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Quotation Method


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Currency Precision Rounding

■ Currency dictates the precision of monetary amounts.

■ For example, United States dollar amounts have two digits to the right

of the decimal and Japanese yen have none.

■ PeopleSoft software addresses currency precision as follows:

‒ PeopleSoft delivers currency sensitive amount fields with a standard length of 23.3 (23

digits to the left of the decimal point and 3 digits to the right of the decimal point)

‒ By default, PeopleSoft software rounds all currency sensitive amount fields to the

currency precision of the associated currency. This action is a PeopleTools option that

you can deactivate.

‒ All numbers on SQR reports are currency sensitive. For reporting with XML and

PS/nVision, the display is equal to the field precision, but you can increase the number

of decimals.

‒ The journal entry screen will show an error if a user enters more decimal places than

specified on the currency code page


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Currency Precision

Currency precision ranges from zero decimal points to three

decimal points per ISO standard

The journal will be in error if more decimal places than specified on

the currency code page are entered


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Currency Triangulation

Cross currency triangulation allows you to convert two currency

pairs, which do not exist as standard pairs, using a third currency

as a reference


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Currency ControlsControls that are defined for a ledger group override those defined for a

business unit, and controls selected for a source override both a ledger

group and a business unit.

■ Business Unit

Establish Base Currency

Currency Balance Options

■ Ledger Group

Rounding Adjustment Option

■ Journal Source


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Business Unit


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Ledger


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Journal Source


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GL Currency Mapping


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Update Currency Effective Date at Header Level


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Journal Line – Primary Ledger

■ Adjust Amount or Rate for Primary Ledger (ACT_LOC)

■ If you change either the Amount, Base Amount or Rate, you can have

the system calculate one of the three by changing the Calculate

value or just leave the System Rule default


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Ledger

■ You can define multiple ledgers for various multi-national reporting

■ Ledgers in Sync

‒ When you enter a two line journal entry for a ledger group that

contains two ledgers, the system creates two additional lines.


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Journal Line – Secondary Ledger

■ Adjust Base Amount or Rate for Secondary Ledger (SEC_USD) to

update the translated values


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Keep Ledgers in Sync

■ The following query shows journal lines generated for the two ledgers

in this example:

‒ ACT_LOC is the primary ledger

‒ SEC_USD is the translate ledger, which translates transactions in

real time

Multi-Currency Re-Measurement


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Revaluation■ You may need to revalue the base currency of the balance sheet

accounts that you maintain in foreign currencies to reflect changes in

value due to fluctuations in exchange rates

■ Revaluation process adjusts the base currency value of the account

balances by creating adjusting entries for the accounts being revalued.

■ The process creates corresponding entries for any gain or loss that

results from the revaluation.

■ Revaluation takes place at the end of each accounting period for all

Asset and Liability accounts prior to translation.

‒ Ledger: ACT_LOC (in this example)

‒ Timespan: BAL

‒ Rate Type: CRRNT


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Revaluation Example

Note: Same $87.67 transaction is now worth $100.88


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Revaluation at Subsystem■ Re-measurement of gains/losses at ledger, customer and vendor

levels

■ Accounts Payable

‒ The PS/AP Revaluation process finds all unpaid, posted vouchers

for the specified business units as of the specified date whose

transaction currency is not the same as the base currency of the

general ledger business unit.

‒ For each unpaid voucher, it uses the specified exchange rate and

calculates a revaluation amount.

‒ The accounting entry consists of an unrealized gain or loss entry

with a matching offset on the payables account.


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Translation■ For reporting purposes, you can translate base currency balance of foreign

entity to your reporting currency.

■ You can maintain a secondary ledger (SEC_USD) for real time translation at

the effective CRRNT rate or AVG rate.

■ Translation takes place at the end of each accounting period for all accounts

after revaluation.

■ Translation only occurs for Business Units with non-USD base currency when

translating to USD.

■ The process creates corresponding entries for any gain or loss that results

from the translation.

‒ Ledger: SEC_USD (in this example)

‒ Timespan: BAL (Balance Sheet accounts) PER (Income Statement accounts)

‒ Rate Type: CRRNT (Balance Sheet accounts) AVG (Income Statement accounts)


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Translation Example

Multi-Currency GL Adjustments


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Scenario 1 - Adjust Original Base Amount

■ Adjustment in Period 2

■ Since the original transaction amount never goes to zero, you will

always have a “revaluation adjustment” from month to month


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Scenario 1 - Adjust Original Base Amount

■ Adjustment in Period 2




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Scenario 2 - Adjust Translated Amount■ Adjustment in Period 2



■ But now you will have revaluation for GBP and USD amounts


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Scenario 2 - Adjust Translated Amount■ Adjustment in Period 2



■ But now you will have revaluation for GBP and USD amounts


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Scenario 3 - Adjust Original Transaction Amount■ Adjustment in Period 2 – using same rate

■ Adjustment in Period 2 – using current rate

■ You will have a temporary residual until “revaluation” is processed


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Scenario 3 - Adjust Original Transaction Amount■ Adjustment in Period 2 – using same rate

■ Adjustment in Period 2 – using current rate

■ You will have a temporary residual until “revaluation” is processed

Multi-Currency Reporting


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GL Currency Mapping


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Reporting from GL Ledger Table

■ Transaction Amount (POSTED_TRAN_AMT)

‒ Can be in any currency code

‒ Serves as the foreign amount when the currency code is different

then the base currency code defined for that Business Unit

■ Base Amount (POSTED_BASE_AMT)

‒ Only one currency code can be defined for a Business Unit

■ Posted Total Amount (POSTED_TOTAL_AMT)

‒ Any amount that is posted to Ledger, can be in foreign currency or

base currency

‒ When used in reporting, you will always have to specify the currency

code


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Ledger Example

■ For multi-currency ledger reporting it is safest to use Posted Base Amt

■ If you used Posted Total Amt, you always have to make sure to

designate the correct currency


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nVision Report■ Layout Tips

‒ Use Based Amount (POSTED_BASE_AMT) so you won’t have to

identify the currency

‒ Include all currency codes as nVision automatically defaults to

USD if not specified

Multiple GAAPs

Multiple GAAPs

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Ledger Approach Book Code Approach

Local GAAP Adjustments

CommonIFRS

Adjustments

Local GAAP

IFRS

Multi-GAAP Ledger

L = Local Book Code C = Corp Book Code B = Common Book Code

Transactions are posted to the respective ledgers. nVision is used to produce reports for

Local GAAP and IFRS.

Single ledger holds transactions for all GAAPs; Book Code ChartField used to

identify transactions; Ledger Code is used to produce the Local GAAP and IFRS reports.

CommonLocal Only

IFRS Only

Ledger Code - LOCAL

Ledger Code = IFRS

BU ACCOUNT ALT ACCT

Corp GAAP Local GAAP

Multiple GAAPs

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Ledger Approach

• The Ledger approach allows users to define different or multiple

ledgers to suit the organization’s structure.

• The user can have one ledger that addresses common transactions.

• A second ledger that groups IFRS adjustments.

• A third ledger for entering local GAAP adjustments.

• The user can then create reports using nVision and Tree Manager to

group the ledgers as appropriate.

Multiple GAAPs

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Book Code Approach You can use Book Code to handle multiple GAAP requirements within

the same ledger.

The Book Code ChartField can identify a transaction as either local

GAAP, IFRS or both.

This allows items that affect both local GAAP and IFRS

simultaneously to be entered only once rather than duplicated to each

associated ledger.

Users can then use Ledger Codes to define what transactions (based

on Book Codes) to use in their reports.

This allows organizations to ensure consistency with accounting and

data gathering across the world, while at the same time recording

transactions in compliance with local regulation.

Multiple GAAPs

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Book Code

If you activate the book code, you must specify a

book code for each account value.

‒ You can attach these book codes to accounts as attributes

‒ A unique account value must be created for each book code

‒ Book code appears as a read only field on the journal entry

page

■ Can override at time of Journal Entry

‒ The Allow Book Code Override option that is set on the

ChartField Account page

‒ Using this method, you can associate any of your book

codes with the same account value to record related

amounts in the same ledger

Multiple GAAPs

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Ledger Code Use this page to create ledger codes

Assign them to the applicable book codes to define subsets that

segregate various accounting treatments of transactions

Multiple GAAPs

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Alternate Account

■ You can enter and maintain both a statutory (local) account value and a corporate (internal) account

value at the detail transaction level within General Ledger, as well as within subsystems.

SpearMC.com/insights: Tools & Resources

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http://spearmc.com/insights/

http://spearmc.com/insights/

SpearMC Presentation at Reconnect

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Wednesday, July 22 @ 1:30-2:20pm Powerful PeopleSoft 9.2 Connected Query

Session ID: 103070

Presented by Keith Harper

Thursday, July 23 @ 1:30-2:20pm Beyond the Basics with nVision and Query for

PeopleSoft 9.2 Session ID: 100210

Presented by Millie Babicz

Questions?

[email protected]

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Session ID #100220

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