Cash account set to Multi-currency, any impact?

[too_muihwee]

Hi,

Just want to know if the cash account's currency was set to SGD for example and there are lots of transaction already. Subsequently, the account currency is set to multi-currency. Any impact on reporting or accounting point of views? Kindly advise if you know, thanks.

Regards,

MH

[preety_goel · Accepted solution]

Hi,

If you enter multi-currency in the Currency field, you can post line

items to this account in any currency. The system, however, manages

the account balance only in the local and system currencies.

In other words, it does not manage the balance in the

currencies in which the items were entered. This makes it difficult to

reconcile the account with an external statements if required. You should,

therefore, try to avoid managing an account in multiple currencies if at

all possible.

Please also note that this change will be irrevrsible. An account can be changed from

a single currency account to multi currency account, but it cannot be changed from

multi currency account to single currency.

Regards,

Preety Goel

SAP Business one Forums Team

[Former Member]

Hi,

Just a few extra tips as your question has been answered.

When you open a physical account with a bank (a.k.a. cash account), the account will be of a specific currency normally, and likewise it would be in best practice to do the same in SAP Business One. This would in turn at the end of the day give you a true picture or scenario of you cash account in your system.

As already mentioned this prevent entry of other currencies onto that account. Where this would be a problem is that, when your bank sends you a statement (which will be in the currency of the account you opened with them) to reconcile with what is in your system (your cash account), you will not be able to reconcile amounts that are in another currency other than local currency.

A good example could be that one of your employees enters US 1000 but with the wrong currency say EURO. You would reach a situation where by you will try to match the US 1000 that is on your statement, to EURO 1000 that was entered by mistake in your system. NOT POSSIBLE. Hope that helps.

And guess what that is just the tip of the iceberg when you consider reporting exchange gains/losses.

Cheers

Jugo Kamuntu

+256712110828