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Foreign Currency - Revaluation / Translation


I wanted to discuss and understand the best practice for foreign currency revaluation and translation routine.

This is how we do and configured the revaluation / translation routine:


Valuation Area:

SG for revaluation - Currency Type 10 (Local)

S2 for translation - Currency Type 30 (Group)

Valuation Method: EVR (Always Valuate)

In the ledger currencies for 30, "Translation taking transaction currency as a basis".

Plus other coniguration for account determination (both revaluation and translation). - OBA1 and "Define Account detemination for currency translation".

Based on this configuration, we run following transactions at month end:

Revaluation: FAGL_FC_VAL using S2

Translation: FAGL_FC_TRANS using SG

So what it does is, it revalue document currency into local currency and then translate document currency into group currency.

Ideally, what should be as per GAAP is: Revalue document currency into local currency and then translate local currency into group currency.

In our configuration, we are not able to translate out of local books. The configuration translates from document currency to group currency.


Are we missing anything in the configuration or this is standard? What is the best practice or how other companies are running the revaluation/translation routine?

Scenario is:

Document Currency: AUD

Local Currency: GBP

Group Currency: USD

Please advise.



Former Member

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