Understanding Multicurrency AAIs for Accounts Payable

You set up AAI items to calculate currency gains and losses. The system uses these AAIs to distribute the gain or loss to the correct general ledger account. The potential for a currency gain or loss is due to exchange rate fluctuations that occur between either:

• The time a voucher is entered and payment is issued (realized gain/loss).

• The time a voucher is entered and the end of a period if the voucher is still open (unrealized gain/loss).

For payments and open vouchers in a foreign currency, the gain or loss is calculated between the domestic and foreign currencies. For payments in an alternate currency, the gain or loss is calculated between the domestic, foreign, and alternate currencies.

You also set up AAI items to define trade accounts for foreign currency vouchers and bank accounts for foreign and alternate currency payments.

Some AAI items have a suffix of xxx to accommodate a three-character currency code. You use the xxx suffix to set up multiple currency-specific AAI items for each company. If you do not specify a currency code (that is, leave it blank), the system uses the currency code of the company as the default.