Exclude Exchange Rate Variances from Impacting Acquisition Costs

Exclude exchange rate variances (ERV) recorded on payables invoices in Receipt Accounting and Cost Accounting transactions. This feature prevents the impact of ERV on inventory valuation when receiving purchase orders with inventory, expense, and work order destinations.

Some of the benefits of this feature include:

  • Adhere to regulatory requirements for inventory valuation by classifying ERV as a period expense that's recorded in the period it's incurred.
  • Ensure accurate unit item costs and inventory valuation.
  • You can use this feature across all cost methods to exclude ERV for item costs and inventory valuation.

Steps to Enable

To enable this feature:

  1. In the Setup and Maintenance work are, go to Receipt Accounting -> Manage Receipt Accounting Profile Options
  1. Search for the profile option.
    • Profile option code: ORA_CMR_IGNORE_AP_ERV_TERV
    • Profile option name: Ignore Invoice Exchange Rate Variances for Inventory, Expense, and Work Order Destination Purchases
  1. Select a profile value based on your business requirements:

Enable profile option

Enable profile option

Tips And Considerations

  • You can use this feature for all cost methods if you don't intend to apply exchange rate variances as acquisition cost adjustments to the unit item cost and inventory value.
  • Consigned purchase orders aren't impacted by this profile option.
  • If this feature is enabled, any exchange rate variance distributions lines will be ignored from receipt and cost processing and where applicable, such lines will also not be interfaced to Projects.
  • This profile option will apply to only any new invoice lines being processed in Receipt Accounting. 
  • If you want to ignore all invoice variances from impacting acquisition costs of an item, you can use the following profile option introduced in prior releases:
    • Profile option code: ORA_CMR_IGNORE_AP_INV_VAR_ALL
    • Profile option name: Ignore Invoice Variances for Inventory and Work Order Destination Purchase Orders

Key Resources

  • Oracle Fusion Cloud SCM: Using Supply Chain Cost Management guide, available on the Oracle Help Center.

Access Requirements

Users who are assigned configured job roles that contain these privileges are able to access this feature:

  • Create Receipt Accounting Distributions (CST_CREATE_RECEIPT_DISTRIBUTIONS)