Reporting Currencies

Introduction

The Reporting Currencies feature allows you to report and maintain accounting records in more than one functional currency. You do this by assigning one or more reporting currencies to your primary ledger or secondary ledger using General Ledger’s Accounting Setup Manager. A secondary ledger is an optional, additional ledger that is associated with the primary ledger for an accounting setup. Secondary ledgers can be used to represent the primary ledger's accounting data in another accounting representation that differs in one or more of the following from the primary ledger:

• Chart of accounts

• Accounting calendar/period type combination

• Currency

• Subledger accounting method

• Ledger processing options, such as Suspense Posting

Unlike secondary ledgers, reporting currencies must share the same chart of accounts, accounting calendar/period type combination, subledger accounting method, and ledger processing options as their source ledger.

As a general rule, always use reporting currencies instead of secondary ledgers if you only need to maintain an accounting representation that differs in currency alone. You can assign reporting currencies to both primary and secondary ledgers. Reporting currencies are maintained at one of the following currency conversion levels:

• Subledger: Maintains a currency representation of your subledger journals, General Ledger journal entries, and balances. When using the subledger level reporting currency, you must define subledger accounting rules using Subledger Accounting. These rules provide instructions on how to convert subledger data entered into the source ledger to one or more subledger level reporting currencies. You must also define journal conversion rules that General Ledger Posting uses to automatically convert specific journals, such as manual journal entries, to one or more subledger level reporting currencies.

  Note: Subledger level reporting currencies can only be assigned to primary ledgers, not secondary ledgers.

• Journal: Maintains General Ledger journal entries and balances in another currency representation. Journal level reporting currencies are maintained using the General Ledger Posting Program. Every time a journal is posted in the source ledger, such as the primary ledger or secondary ledger, the journal is automatically converted to the respective journal level reporting currency based on the journal conversion rules defined.

• Balance: Maintains balances in another currency. The General Ledger Translation program is used to convert balances from the source ledger to the balance level reporting currency. When you run Translation in your primary or secondary ledger and specify a target currency, the translated balances are reflected in the balance level reporting currency.

  Note: If a balance level reporting currency is not assigned to the ledgers in the accounting setup, a balance level reporting currency is automatically created the first time Translation is run. The name of the balance-level reporting currency is the same as its source ledger, except that its currency code, such as GBP, is appended to its name.

The subledger level and journal level reporting currencies act similarly to ledgers. You must open and close the periods for these reporting currencies before you can enter transaction and journal entries. You can also enable journal approval for these reporting currencies if planning to enter manual journal entries directly to these reporting currencies.

Functional Currencies

The following terms are fundamental to using Reporting Currencies:

Table 15-1 Functional Currencies and Ledgers

Functional Currency	Your organization’s functional currency as discussed in SFAS #52 and IAS 21 can be different from the ledger currency that is assigned to primary and secondary ledgers. For example, you may choose Japanese Yen (JPY) for your ledger currency when your functional currency for the accounting purposes of your integrated business group is actually US Dollars (USD). The determination of the functional currency is based on a number of factors, discussed in SFAS #52 and IAS 21.
Ledger Currency	The ledger currency is the currency you assign to a ledger, such as the primary ledger or secondary ledger, and represents the base currency that is used to record transactions and maintain your accounting data within Oracle E-Business Suite. The primary ledger’s currency is generally the currency in which you perform most of your business transactions and the one you use for legal reporting.
Reporting Currency	A currency, other than your ledger currency, for which you need to report. The reporting currency shares the same chart of accounts and accounting calendar as the source ledger (either the primary ledger or secondary ledger), but typically uses a different currency. The reporting currency allows you to report in a different currency than that of your primary or secondary ledger.
Primary Ledger	A financial reporting entity in which you conduct business. The primary ledger acts as the main, record-keeping ledger and uses a particular chart of accounts, accounting calendar, currency, and subledger accounting method.
Secondary Ledger	An optional, additional ledger that is associated with the primary ledger for an accounting setup. Secondary ledgers can be used to represent the primary ledger's accounting data in another accounting representation that differs in one or more of the following from the primary ledger: Chart of accounts Accounting calendar/period type combination Currency Subledger accounting method Ledger processing options, such as Suspense Posting

Note: For further details about reporting currencies, see Journal or Subledger Level Reporting Currencies in Oracle General Ledger User’s Guide and Reporting Currencies in Oracle Financials Implementation Guide. For further details about secondary ledgers, see Secondary Ledgers in Oracle Financials Implementation Guide.