SAP ABAP IMG Activity SIMG_CFMENUCX01_CU02 (Define Currency Translation Methods)

Hierarchy

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SAP_FIN (Software Component) SAP_FIN
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EC-CS (Application Component) Consolidation
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FC00 (Package) Cons: General consolidation (cannot be assign.to FC01-FC09)

IMG Activity

ID	SIMG_CFMENUCX01_CU02	Define Currency Translation Methods
Transaction Code	S_ALR_87003159	IMG Activity: SIMG_CFMENUCX01_CU02
Created on	19981222
Customizing Attributes	SIMG_CFMENUCX01_CU02	Define Currency Translation Methods
Customizing Activity	SIMG_CFMENUCX01_CU02	Define Currency Translation Methods

Document

Document Class	SIMG	Hypertext: Object Class - Class to which a document belongs.
Document Name	SIMG_CFMENUCX01_CU02

In the methods for currency translation, you specify the exchange rates with which FS items are translated, and how translation differences and rounding differences are handled.

Example

You define translation methods that you commonly use during consolidation, for example, the current-rate method, the temporal method, and so on.

Standard settings

Several translation methods are predefined for consolidation charts of accounts 01,11, and 12 in the standard system. There are no conventions for naming methods, however, the following logic has been used for naming the predefined methods:

The first two digits in the method name correspond with the name of the chart of accounts to which it is assigned.
After a hyphen, numbers are allocated in increments of 10.

The methods contain item sets (translation sets and rounding sets) and subitem sets:

Predefined items sets are named using the following logic:

The first two characters are "CS".
The third and fourth digits indicate the name of the relevant cons chart of accounts.
After the hyphen, the next four digits indicate the contents of the set by reference to an item number.
Example: CS01-1000 Balance sheet

Predefined subitems sets are named using the following logic:

The first two characters are "CS".
The third and fourth digits are "01" (cons chart of accounts).

Subitems are not dependent on the cons chart of accounts; they are valid for all charts. However, if you use sets containing different subitems for different charts of accounts, for example, due to different statutory requirements, you can indicate the relevant chart of accounts using the third and fourth places.

The digits after the hyphen provide information about the contents of the subitem set by reference to the subitem or breakdown category.
Example: CS01-100 Opening balance APC

Explanation of the Predefined Methods

Method 01-10: Modified current rate (tangible fixed assets and annual net income (ANI) on key date)

Tangible fixed assets are translated using the current rate. In order to show temporal translation differences between the closing balance of the prior year and the opening balance of the current year in the asset history sheet, some tangible fixed asset subitems are translated with exchange rate (ER) indicator 4 (current rate of prior year) and others with ER indicator 1 (current rate).
Investment and equity data (excluding ANI) is translated historically on the basis of additional financial data, with translation key 3 or 4.
Retained earnings carried forward from prior years are not retranslated (translation key 6).
The remaining balance sheet items (including ANI) are translated using the current rate.
The income statement is translated using the average rate.
Rounding of ANI in the balance sheet and income statement causes ANI in the income statement to be adjusted so that it matches ANI in the balance sheet.

Method 01-20: Modified current rate (ANI weighted)

The balance sheet is translated as with method 01-10.
ANI in the income statement is translated at the current rate.
The rest of the income statement is translated at the average rate for the month. The difference is posted to the balance sheet item for translation differences in equity.
The rounding rule for the income statement specifies that the difference between the current rate and the average rate is posted to the ANI item in the income statement. This results in ANI in the income statement being valued at an average rate.
The rounding rule for ANI in the balance sheet and income statement causes ANI in the balance sheet to be adjusted to match ANI in the income statement.

01-30: Modified current rate (tangible fixed assets historically/ANI weighted)

For the translation of tangible fixed assets, the assumption is made that the Consolidation component is integrated with transaction applications, in which case values already exist in group currency. Tangible fixed assets are not retranslated (translation key 6).
Investment and equity values (excluding ANI and retained earnings carried forward from the prior year) are translated historically on the basis of additional financial data, with translation key 3 or 4.
Retained earnings carried forward from the prior year are not retranslated.
The rest of the balance sheet (including ANI) is translated at the current rate.
Application integration is also assumed for the translation of amortization and depreciation, which are therefore not retranslated.
The rest of the income statement is translated as with method 01-20.

11-10: Modified current rate (tangible fixed assets and ANI on key date)

Translation takes place as with method 01-10. However, since the appropriation of retained earnings (ARE) is shown in the balance sheet for cons chart of accounts 11, the methods differ as follows:

Retained earnings in the balance sheet (as part of equity) is translated historically on the basis of additional financial data, with translation key 4.

The rounding rule for retained earnings causes retained earnings in the income statement to be adjusted so that they match retained earnings in the balance sheet.

This adjustment causes a imbalance in the income statement that is reversed by a further rounding rule for the income statement (with ARE). The difference is posted to unappropriated retained earnings in the income statement, causing this item to equal retained earnings (historical value) for the prior year.

Method 11-20: modified current rate (ANI weighted)

Translation takes place as with method 11-10, with the following exceptions:

The income statement (without retained earnings) is translated at an average monthly rate, as with method 01-20.

The assumption is made that unappropriated retained earnings exist in group currency, and therefore no translation takes place for this item.

Method 11-30: Modified current rate (tangible fixed assets historically/ ANI weighted)
Same as method 01-30
Method 12-10: Modified current rate (tangible fixed assets and ANI on key date)
Same as method 11-10, with the exception that unappropriated retained earnings are shown in the balance sheet and are therefore not retranslated.
Method 12-20: Modified current rate (ANI weighted)
Same as method 11-20, with the exception that unappropriated retained earnings are shown in the balance sheet and are therefore not retranslated.
Method 12-30: Modified current rate (tangible fixed assets historically/ ANI weighted)
Same as method 11-30, with the exception that unappropriated retained earnings are shown in the balance sheet and are therefore not retranslated.

Activities

Check the predefined translation methods and define a new one if needed:

Initial node Translation Methods

Create a translation method with a key and a description. On the detail screen define the reference exchange rate indicator.

Node Method entries

Define the method entries for the translation and for item rounding. Note that these method entries are cons chart-relevant.

Decide how you want to translate each item.
Define your translation entries. You need one translation entry for each set of items that you want to translate using the same rules. You also need translation entries for balance sheet items, income statement items, and statistical items.
If you have not yet created item sets, you can do this now by choosing Maintain sets.
Decide which rounding checks you want to run.
Make an entry for each rounding check. Indicate that the entry is a rounding entry.
Note:

You can give rounding and translation entries the same numbers, because the rounding indicator enables the system to distinguish between them.
The sequence of rounding entries determines the sequence in which the rounding checks are run.
If you want to run rounding checks over two item sets, and the field for the second item set does not appear for you to make an entry, press ENTER. The field will then be shown.

After you have defined the method entries, choose the node Translation methods once more.
Check the translation methods using the Check function.
The system indicates any errors it finds in your method definitions, for example, if the item sets in the method entries overlap.
If no errors are found during the check, you can activate the method to indicate that it can be used for translating reported financial data.
If you want to print out the method definitions, choose Print.

Business Attributes

ASAP Roadmap ID	204	Establish Functions and Processes
Mandatory / Optional	2	Optional activity
Critical / Non-Critical	1	Critical
Country-Dependency	A	Valid for all countries

Assigned Application Components

Documentation Object Class	Documentation Object Name	Current line number	Application Component	Application Component Name
SIMG	SIMG_CFMENUCX01_CU02	0	HLA0100230	Currency Translation

Maintenance Objects

Maintenance object type

Customizing Object

Assigned objects
Customizing Object	Object Type	Transaction Code	Sub-object	Do not Summarize	Skip Subset Dialog Box	Description for multiple selections
VC_TF400	C - View cluster	CXD1	0000000001			Currency Translation Methods

History

Last changed by/on	SAP	19981222
SAP Release Created in

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