AR - AP Exchange Adjustment

Dear All:

what is the importance of running the exchange adjustment for the AR and AP modules??


It finanical adjusts the ledgers and balances to reflect the current position. If the exchange rate fluctuates greatly then your accounts declaration can be out by this valuation. Talk to an accountant about the processing differences and how it impacts on the ledgers.

If you did not run the exchange rate adjustment,

during the transaction invoice date and the payment date, the exchange rate fluctuated a lot, it could cause misleading on foreign amounts that you convert and post to the General Ledger, and then display in reports.

Therefore, exchange rate adjustments are important for correct periodic accounting.


It is important because it will determine the true value of your transactions upon invoice, payment or receipt.