Understanding Foreign Currency Receipts

A foreign currency receipt is a receipt that is in the foreign (transaction) currency of the invoice. You specify the foreign currency of the receipt at the time you enter the receipt. When you enter a foreign currency receipt, these criteria must be met for the system to process the receipt:

• The foreign currency of a receipt must be the same as the transaction currency of the invoice.

• The base currency of the receipt must be the same as the domestic (base) currency of the invoice.

• If the bank account is a monetary account, the currency of the company to which the bank account is assigned must be the same as the base currency of the receipt and invoice; otherwise, the system issues an error message and you cannot continue entering the receipt.

When you enter a receipt in a foreign currency, the system converts the foreign currency amount to the domestic currency amount based on the exchange rate in the F0015 table or, if applicable, a spot rate entered on the receipt record.

In this example, the base currency of the receipt is USD. You can:

• Apply a EUR receipt to the foreign amount of invoice 223 (EUR).

• Apply a CAD receipt to the foreign amount of invoice 224 (CAD).

  In both cases, the company base currency on the receipt is the same as the domestic currency of the invoices; therefore, the system enables you to apply receipts in the foreign currency.

The currencies for the invoices are:

• Invoice Number: 223

  Domestic currency of invoice: USD

  Foreign currency of invoice: EUR

  Domestic currency of receipt: EUR

• Invoice Number: 224

  Domestic currency of invoice: USD

  Foreign currency of invoice: CAD

  Domestic currency of receipt: CAD

The receipts, which are in the foreign currency of the invoices (EUR and CAD, respectively), pay the foreign amounts of the invoices. A realized gain or loss might be calculated if the exchange rate changes between the time the invoice was entered and the receipt is applied.