This chapter contains the topic:
Amount differences occur when sale or purchase transactions are contracted for in a currency other than rubles and there is a difference in the exchange rate between the purchase or sale date and the date on which the payment is made. For example, when your company agrees to purchase goods from a supplier, you might set the price in Euros or US dollars. The payment for the goods must occur in rubles, and will probably occur at a date after the shipment of goods, so there might be a difference in the contracted amount and the actual payment amount due to fluctuation in the exchange rate from the time the goods were purchased and the time the payment was made.
When an amount difference occurs in a transaction, you must issue a voucher for the difference in amounts. This difference is subject to VAT and is reported in the Sales Book or the Purchase Book.
To set up your system to account for the amount differences caused by the use of two currencies, you must complete the following steps:
Turn on multi-currency in the General Accounting Constants.
Define the currency rates in the system.
The rates for each currency must be determined on each date on which the transaction occurs. For example, you must establish the currency rate on the date a purchase was made and on the date the payment for the purchase was made
Set up amount difference accounts.
You should set up accounts for debits and for credits. For example, you might set up an account for "Other Income" for credits and "Other expenditures" for debits.
To process vouchers, you must set up the AAIs for realized gains (PG) and for realized losses (PL) with a suffix that is equal to the currency code of the vouchers you process.
For example, to process vouchers in rubles, you must set up the AAI. "PGRUB".
To process invoices, you must set up the AAIs for realized gains (RG) and realized losses (RL) with a suffix that is equal to the currency code of the invoices you process.
For example, to process vouchers in rubles, you must set up the AAI. "RGRUB".
You must define as bank accounts the amount difference accounts that you set up so that the system can process manual and automatic payments for amount difference vouchers.
You must set up the AAI ERR for Exchange Rate for Accounts Receivable. It retrieves the account number used to write the distribution record that the invoice creates, as well as the bank account used to write the receipt.
You must set up the AAI ERP for Exchange Rate for Accounts Payable. It retrieves the account number used to write the distribution record that the voucher creates, as well as the bank account used to write payment.
You must set up AAIs to account for gains and losses in currency exchanges when you process vouchers and invoices
Set up these AAIs for Russia:
PIxxxx (where xxxx is the G/L class of the tax area) for VAT actual accounts for Accounts Payable
PTxxxx (where xxxx is the G/L class of the tax area) for VAT receivable accounts for Accounts Payable
RIxxxx (where xxxx is the G/L class of the tax area) for VAT actual accounts for Accounts Receivable
RTxxxx (where xxxx is the G/L class of the tax area.) for VAT receivable accounts for Accounts Receivable
When foreign vouchers and invoices are paid or received and exchange rate differences cause a gain or a loss to occur, the gain or loss amount must be handled as a legitimate transaction. A valid invoice or voucher must be entered, then received or paid for with a resulting gain or loss. If taxes were involved in the original invoice or voucher, they should also be processed for the newly created invoice or voucher.