You can control expenses regardless of the currency. You can enter purchase orders and invoices in a foreign currency and check funds for them. However, you must enter the exchange rate to convert foreign currency amounts to their equivalents in the ledger currency.
Before entering foreign currency transactions, you must define currencies and rates of exchange in General Ledger.
The exchange rate defined in General Ledger is the rate you multiply by the ledger currency to obtain the equivalent foreign currency amount. For example, if the ledger currency is USD (U.S. Dollar) and the chosen foreign currency is FFR (French Franc), enter 5 if the exchange rate is 5 francs per dollar.
Note: The exchange rate in Purchasing and Payables is the reciprocal of the rate defined in General Ledger.
When creating a foreign currency purchase order using the Enter Purchase Orders window, you must enter an exchange rate before entering purchase order price information. Enter exchange rate information in the Foreign Currency Information region of the Enter Purchase Orders window. You can navigate to this region from the Additional Purchase Order Header Information field in the Purchase Order Header region.
When you create a requisition, enter the line prices in the ledger currency. To match the requisition to a foreign currency purchase order, using the AutoCreate Purchase Orders window, you must change the line prices on the purchase order from the ledger currency to the foreign currency. You must also enter the exchange rate information in the Purchase Order Distributions zone before approving the purchase order. If you do not enter an exchange rate, you cannot approve a foreign currency purchase order.
Oracle Purchasing converts all foreign currency amounts to their equivalents in ledger currency before checking and reserving funds. Oracle Purchasing creates encumbrance journal entries in the ledger currency.
When you post these journal entries, General Ledger maintains balances in both ledger and foreign currencies.
Before entering foreign currency invoices, you must enable the Use Multiple Currencies Payables option. You must enter exchange rate information when you enter a foreign currency invoice. Enter exchange rate information in the Invoices Summary or detail window.
Enter all invoice information in the foreign currency and then approve the invoice. When you approve the invoice or check funds for it, Payables converts all foreign currency amounts to their equivalents in the ledger currency before checking and reserving funds.
If you match an invoice to a purchase order, you can enter the invoice only in the same currency as the purchase order.
You must pay a foreign currency invoice in the same currency in which you entered the invoice. Choose a rate type in the Rate Type field of the Payments Summary or detail window.
You must also use a bank account you have defined for the invoice currency to pay a foreign currency invoice.
Payables automatically calculates and posts any gains or losses from foreign currency transactions to Realized Gains or Realized Losses accounts.
Payables creates journal entries in the foreign currency. When you post these journal entries, General Ledger maintains balances in both the ledger currency and foreign currencies.
You can enter encumbrances only in the ledger currency.
You can run foreign currency journal reports the same way you run other journal reports. When you request the report, enter a currency other than the ledger currency.
You can review trial balances for account amounts entered in a foreign currency.
You can view available funds only in the ledger currency.