This chapter contains the following topics:
Section 7.1, "Understanding Unrealized Gains and Losses in Hungary"
Section 7.2, "Revaluating the Open Foreign Amounts for Invoices"
Section 7.3, "Revaluating the Open Foreign Amounts for Vouchers"
Unrealized gains and losses are the differences in amounts that occur due to the fluctuation in the currency exchange rates that happen during the processing cycle of a voucher or an invoice. For example, if you create a voucher with an exchange rate of xx, and you pay the voucher three days later with the current exchange rate of yy, then the difference between the voucher amounts when the voucher was created and when it was paid is a gain or loss. However, those gains and losses are unrealized, or not reflected, in the general ledger and accounts payable records until you create accounting entries to account for such differences. Therefore, in Hungary, you run unrealized gains and losses programs to calculate unrealized gains and losses after you process invoices or vouchers.
The process to calculate and account unrealized gains and losses includes:
Revaluating the domestic amounts of the corresponding foreign amounts at the end of year.
For each foreign open invoice, revaluating the amounts based on the existing exchange rate at year-end.
Updating your general ledger, accounts payable, and accounts receivable records.
This section provides an overview of the revaluation of domestic amounts for foreign open invoices and discusses how to:
Run the A/R - Generate Yearly Revaluation program.
Set processing options for the A/R - Generate Yearly Revaluation program (R74H309).
Run the A/R - Daily Revaluation Update program.
Set processing options for the A/R - Daily Revaluation Update program (R74H319).
To abide by the Hungarian Corporate Tax Law and Accounting principles, you must run the A/R Generate Yearly Revaluation and A/R - Daily Revaluation Update reports to calculate unrealized gains and losses while working with foreign vouchers.
You must run the A/R Generate Yearly Revaluation report at the end of the fiscal year. For each foreign open amount, this report generates a new gain or loss document based on exchange rate fluctuations between the time that the voucher was created and the as of date of the report.
Run the A/R - Daily Revaluation Update report after you enter a receipt for an invoice. It voids the revaluated document and if there is still any open amount, it generates a new revaluated document with the revaluated open amount.
Select Unrealized/Realized Gains and Losses (G74H11), A/R - Generate Yearly Revaluation
Processing options enable you to specify default processing values.
Specify whether to run the report in proof or final mode. Values are:
Blank: Run in proof mode. The system prints a report only.
1: Run in final mode. The system creates revaluated documents, journal entries, and prints a report.
Specify the document type to use as revaluated document.
Enter the company for which you process records.
|
Note: You can use company 00000 for default values such as dates and automatic accounting instructions. You cannot use company 00000 for transaction entries. |
Enter the date to process invoices and payments. The system uses this date to recalculate invoice amounts as of the date that you enter. The system recalculates both domestic and foreign amounts. After the invoice amounts are recalculated, the system calculates gain or loss. If you leave this option blank, then as of processing does not occur.
Specify the date for determining the current exchange rate. If left blank, the system uses the date in the G/L Date processing option. If you leave the G/L Date processing option also blank, the system uses the date in the As of Date processing option.
Specify the G/L date for the currency gain and loss journal entries and document. If you leave this processing option blank, the system uses the date in the As of Date processing option.
Specify whether to assign the batch status to journal entries that the system creates based on the Management Approval of Input option on the General Accounting Constants form. Valid values are:
Blank: Assign the batch status based on the setting of the Management Approval of Input option.
1: Assign the approved batch status of A.
Enter a value from UDC table 00/PS to specify the pay status that the system assigns to the revaluated document. If you leave this option blank, the system assigns pay status R. Examples are:
#: Payment in Process
%: Withholding Applies
A: Approved for Payment
D: Draft Accepted
E: Draft -Expired not Collected
G: Draft Deposited not Due
P: Paid in Full
R: Retainage
Z: Selected/Payment Pending
Specify when the system creates revaluation documents and journal entries for currency gains and losses. If you leave this option blank, the system creates revaluation documents and journal entries for both gains and losses. Valid values are:
1: Create revaluation documents and journal entries for both gains and losses.
2: Create revaluation documents and journal entries only for losses.
3: Create revaluation documents and journal entries only for gains.
Select Unrealized/Realized Gains and Losses (G74H11), A/R - Daily Revaluation Update
Processing options enable you to specify default processing values.
Specify whether to run the report in proof or final mode. Values are:
Blank: Run in proof mode. The system prints a report only.
1: Run in final mode. The system creates revaluated documents, journal entries, and prints the report.
Enter the company for which you process records.
|
Note: You can use company 00000 for default values such as dates and automatic accounting instructions. You cannot use company 00000 for transaction entries. |
Specify whether to assign the batch status to journal entries that the system creates based on the Management Approval of Input option on the General Accounting Constants form. Valid values are:
Blank: Assign the batch status based on the setting of the Management Approval of Input option on the General Accounting Constants form.
1: Assign the approved batch status of A.
Specify whether to reclassify amounts from unrealized accounts to realized accounts. Values are:
Blank: Do not reclassify amounts from unrealized accounts to realized accounts.
1: Reclassify amounts from unrealized accounts to realized accounts.
This section provides an overview of the revaluation of domestic amounts for foreign open vouchers and discusses how to:
Run the A/P - Generate Yearly Revaluation program.
Set processing options for the A/P - Generate Yearly Revaluation program (R74H409).
Run the A/P - Daily Revaluation Update program.
Set processing options for the A/P - Daily Revaluation Update program (R74H419).
To abide by the Hungarian Corporate Tax Law and Accounting principles, you must run the A/P - Generate Yearly Revaluation and A/P - Daily Revaluation Update reports to calculate unrealized gains and losses while working with foreign vouchers.
You must run the A/P - Generate Yearly Revaluation report at the end of the fiscal year. For each foreign open amount, this report generates a new gain or loss document based on exchange rate fluctuations between the time that the voucher was created and the as of date of the report.
Run the A/P - Daily Revaluation Update report after you pay a voucher. It voids the revaluated document and if there is still any open amount, it generates a new revaluated document with the revaluated open amount.
Select Unrealized/Realized Gains and Losses (G74H11), A/P - Generate Yearly Revaluation.
Processing options enable you to specify default processing values.
Specify whether to run the report in proof or final mode. Values are:
Blank: Run in proof mode. The system prints a report only.
1: Run in final mode. The system creates revaluated documents and journal entries, and prints a report.
Specify the document type to use as revaluated document.
Enter the company for which you process records.
|
Note: You can use company 00000 for default values such as dates and automatic accounting instructions. You cannot use company 00000 for transaction entries. |
Enter the date to process invoices and payments. The system uses this date to recalculate invoice amounts as of the date that you enter. The system recalculates both domestic and foreign amounts. After the invoice amounts are recalculated, the system calculates gain or loss. If you leave this option blank, then as of processing does not occur.
Specify the date for determining the current exchange rate. If left blank, the system uses the date in the G/L Date processing option. If that value is blank, the system uses the date in the As of Date processing option.
Specify the G/L date for the currency gain and loss journal entries and document. If you leave this processing option blank, the system uses the value in the As of Date processing option.
Specify whether to assign the batch status to journal entries that the system creates based on the Management Approval of Input option on the General Accounting Constants form. Valid values are:
Blank: Assign the batch status based on the setting of the Management Approval of Input option.
1: Assign the approved batch status of A.
Enter a value from UDC table 00/PS to specify the pay status that the system assigns to the revaluated document. Examples are:
#: Payment in Process
%: Withholding Applies
A: Approved for Payment
D: Draft Accepted
E: Draft -Expired not Collected
G: Draft Deposited not Due
R: Retainage
Z: Selected/Payment Pending
|
Note: You must not leave this processing option blank. Otherwise, the system assigns it a value of P that leads to incorrect processing. |
Specify when the system creates revaluation documents and journal entries for currency gains and losses. If you leave this option blank, the system creates revaluation documents and journal entries for both gains and losses. Valid values are:
1: Create revaluation documents and journal entries for both gains and losses.
2: Create revaluation documents and journal entries only for losses.
3: Create revaluation documents and journal entries only for gains.
Select Unrealized/Realized Gains and Losses (G74H11), A/P - Daily Revaluation Update
Processing options enable you to specify default processing values.
Specify whether to run the report in proof or final mode. Values are:
Blank: Run in proof mode. The system prints a report only.
1: Run in final mode. The system creates revaluated documents, journal entries, and prints the report.
Enter the company for which you process records.
|
Note: You can use company 00000 for default values such as dates and automatic accounting instructions. You cannot use company 00000 for transaction entries. |
Specify whether to assign the batch status to journal entries that the system creates based on the Management Approval of Input option on the General Accounting Constants form. Valid values are:
Blank: Assign the batch status based on the setting of the Management Approval of Input option on the General Accounting Constants form.
1: Assign the approved batch status of A.
Specify whether to reclassify amounts from unrealized accounts to realized accounts. Values are:
Blank: Do not reclassify amounts from unrealized accounts to realized accounts.
1: Reclassify amounts from unrealized accounts to realized accounts.