How Initialization Period Works for Source and Target Ledgers with EMU Currency Relationship
This table provides an example of how the relationship between the intialization period selection and the Create Opening Balance Journals in Reporting Currency or Secondary Ledger process converts balances when both the source and target ledgers have EMU currencies.
Period Number | Period Status in Source Ledger | What Does the Process Convert? |
---|---|---|
1 | Closed | N/A |
2 | Closed | N/A |
3 | Closed | N/A |
4 | Open | N/A |
5 | Open | Year-to-date balances |
6 | Open | Period-to-date balances |
7 | Open | Period-to-date balances |
8 | Open | Period-to-date balances |
9 | Future Enterable | N/A |
10 | Future Enterable | N/A |
11 | Future Enterable | N/A |
12 | Future Enterable | N/A |
13 | Future Enterable | N/A |
In this example, the initialization period will be period 9 because it’s the first future enterable period.
The conversion start period is period 5. The process will create initialization journals for each period starting from period 5 to period 8.
The initializing rates must be defined as daily rates using a rate type defined specifically for the balance initialization process. After they're defined, enter the corresponding rate type in the Balance Initialization section of the Reporting Currency or Specify Ledger Options page.
Posting the journals initializes the reporting account balances converted from the periods in your source ledger. When you later open the balance initialization period, the ending balances from the period prior to the initialization period roll forward to become the beginning reporting account balances for the first future balance initialization period. Once the initialization journal is created in the target ledger, then the balance initialization setup will be frozen for making any changes.