Rounding differences - translation in BCS to thousands

[Former Member]

Hello everybody,

We translate the figures from Local currency (ILS) to thousands Local currency (we created new currency code u2013TILS). We maintained conversion factor of 1:1000 and translation rate 1:1. The client insist the figures in Group currency will be without digits , for example LC u2013 100,569 will become 101 after translation and not 100.569.

I was able to reach the results by defining no decimal places for TILS currency code.

I searched the forum before opening my thread. I saw Eugene wrote they built translation method with a lot of steps per each item. I defined translation method with 1 step only u2013 all items are translated cumulatively by end of day/month (M) rate. Translation difference item is P&L item XXX. Rounding method I use is a method that uses 3 steps (1 BS is rounded to clearing item of RE in BS, 2- P&L is rounded to clearing item of RE in P&L, 3 clearing item of RE in BS= clearing item of RE in P&L and rounded to clearing item of RE in P&L).

The problem is that we discovered that sometimes it can happen that Cons PC clearing item is out of balance because of rounding differences (instead of P&L item XXX rounding differences go to Cons PC clearing item).

Does anyone have some experience of how to deal with rounding differences in BCS and under the following conditions:

1.Total Cons PC clearing item must be equal to zero in each value (LC and GC)

2. clearing item of RE in BS= clearing item of RE in P&L

Thank you,

Lilia

Edited by: Lilia on May 29, 2010 1:54 PM

[Former Member]

Hello Sharad,

I don't understand how I must use it and what problem exactly it should solve.

I will appreciate further directions.

Thank you

Lilia

[Former Member]

Hi Lilia,

Hope your problem has been resolved kindly find below code for future reference.

create function module with following steps

Step1. V_IN TYPE WERTV8

FLAG TYPE CHAR1

Step2. V_OUT TYPE WERTV8

Step3.

*"----

---

""Local Interface:

*" IMPORTING

*" REFERENCE(V_IN) TYPE ZCAP_DRAWN

*" REFERENCE(FLAG) TYPE CHAR1

*" EXPORTING

*" REFERENCE(V_OUT) TYPE ZCAP_DRAWN

*"----

---

DATA: V_1 TYPE P,

V_2 TYPE P.

DATA: V_DELTA1 TYPE P,

V_DELTA2 TYPE P.

V_1 = V_IN DIV 1000.

V_DELTA1 = ABS( V_1 * 1000 - V_IN ).

*Sharad Dixit

V_2 = V_1 + 1.

V_DELTA2 = V_2 * 1000 - V_IN.

IF FLAG = SPACE.

IF V_DELTA1 < V_DELTA2.

V_OUT = V_1 * 1000.

ELSE.

V_OUT = V_2 * 1000.

ENDIF.

ELSE.

V_OUT = V_1 * 1000.

ENDIF.

[Former Member]

Hi Scottsman

There are main financial statemens as well as notes, for example, fixed assets in BS are represented by one figure, for example - 156. In the note you must shou Fixed assets OB, additions, reduction. You do this by using movement type. So theretically, there can arise some rounding differenses, and a total line in a note will be equal to 155 or 157. This is wrong. Analysis is for ecomonists, accountants are worried about each cent

[Former Member]

Hi Eugeny,

What you suggest is to add another task to monitor. It iis complicated. Anyway, I said to the client they should work in BCS with 3 decimal places and deal with rounding differences in BEX reports.

Thank you,

I'm closing the thread

Lilia

[Former Member]

Hi Eugeny

Thank you, but how? The Cons PC is not a part of Breackdown category, how can I post to it?

[Former Member]

Lilia,

By using a reclass: from the item known for the difference reclass all amounts to the COMP+PC combination of your choise.

[Former Member]

Hi Eugeny,

Of course we use a matrix structure, otherwise the Cons PC item won't be relevant.

For example, company 1000 is defined with Cons PC 100,200 and 300 in matrix.

I upload figures to BCS as follows:

Company Cons PC Item Value in LC

1000 100 111 -12,356

1000 200 222 -10,300

1000 300 333 22,656

123 - clearing item for Cons PC

After RE the figures look like these: (each Cons PC is balanced by clearing PC item)

Company Cons PC Item Value in LC

1000 100 111 -12,356

1000 200 222 -10,300

1000 300 333 22,656

1000 100 123 12,356

1000 200 123 10,300

1000 300 123 -22,356

After translation (only devide by 1000) and the group currency is without decimal places, the figures are:

Company Cons PC Item Value in LC Value in GC

1000 100 111 -12,356 -12

1000 200 222 -10,300 -10

1000 300 333 22,656 23

1000 100 123 12,356 12

1000 200 123 10,300 10

1000 300 123 -22,356 -23

Total of item 123 in GC is -1. This item must be always zero. This is the problem.

[Former Member]

In our case we have several hundred steps because of too much data: almost each figure in the B/S or P&L has several detailed breakdowns. In the steps of the rounding method we sum up (or deduct) amounts of those items that must be coherent. The difference (if any) goes to the predefined items (or selected MoveTypes).

If I were you I'd go the same way: post the rounding diference (reverting the sign) to the PC of your choise.

[Former Member]

Hello Lilia,

Actually I meant several hundreds steps for a rounding method attached to the C/T. In the C/T method there are just a few steps.

Because our client cared about the cents, we had to solve the problem of presenting results in millions and absolute consistency of all reports (upto 1 cent). However, we didn't encounter such a problem like yours. And frankly, I do not understand how this Cons PC clearing item (set to some particular DocTypes?) may affect C/T.

BTW, do you use a matrix structure (Company + PC) of the basis and area?

[Former Member]

Hi TheScotsman

Thank you for your reply.

In each currency totals of trial balance must equal to zero.So, in your example, differences will be posted to some item for differences. You must define in rounding method where you post differences.

My question is still open.

Lilia

[former_member1379680]

>

> Hi TheScotsman 
> Thank you for your reply.
> In each currency totals of trial balance must equal to zero.So, in your example, differences will be posted to some item for differences. You must define in rounding method where you post differences.
> My question is still open.
> 
> Lilia

i know its closed but yes, of course the TB will be balanced, that's what the rounding method is for:

Sales = -10.00 GBP = -9.12 USD

Admin Expense = 3.00 GBP = 2.74

Op Expense = 3.00 GBP = 2.74

General Expense = 4.00 GBP = 3.65

Total GBP = 0, USD = 0.01 (which is posted to your Rounding Difference account)

Materiality

From a group consolidations perspective, any accountant who is worrying about a 1c difference (or cumulation of 1cents adding up to <$1000 USD) is wasting precious time that could be spent on analysis!

E.g Some previous clients of mine have not been interested in analysing anything less than $100,000

[former_member1379680]

Lillia, you may find that it is impossible to removal ALL rounding differences.

but you must ask, why do you need to, how much is the difference?

eg: using a rate of 1 GBP to 0.9124 USD (just as an example)

Sales = -10.00 GBP = -9.12 USD

Admin Expense = 3.00 GBP = 2.74

Op Expense = 3.00 GBP = 2.74

General Expense = 4.00 GBP = 3.65

Total GBP = 0, USD = 0.01

So you have a rounding difference of 1 cent - but who cares?