Understanding Revaluation Indexes

A revaluation index is a numerical value that you use to recalculate or restate the costs of the assets, most often in economies affected by hyperinflation or in situations where wide fluctuations in supply and demand for the assets occur. You can set up revaluation indexes to restate cost in terms of either constant currency accounting or current cost. Typically, index values are obtained from either governments or outside agencies.

You can set up revaluation indexes to conform to whatever periodic recalculation is necessary. In truly hyperinflationary economies, some as high as triple digits, this process might be a daily procedure. The setup also accommodates weekly, monthly, quarterly, annual, or other periodic intervals as needed. You create tables of indexes, each identified by a revaluation code. You can create as many revaluation codes as you need in UDC 12/RI.