Several events occur in Aptify that require the use U.S.e of a currency spot rate.
- Any foreign currency order is marked as shipped.
- A foreign currency payment is received on an existing order in that foreign currency.
- The Cost of Goods sold needs to be calculated for products on a foreign currency order.
- The Mark-To-Market wizard is run on an order or set of orders. One reason to run the wizard is that an accounting period closes and balances exist in receivable and payable accounts for foreign currency transactions. See "U.S.ing the Mark-To-Market Process" on page 255 for Wizard for details.
- A general ledger (GL) batch (Scheduled Transaction, Orders, or Payments) is run and contains foreign - currency transactions.
- A payment in a currency that is different from the order's currency is applied to an order.
For Orders, the currency spot rates used U.S.ed by any of the above events are displayed on the order's Accounting > Currency Spot Rates tab. For Payments in a currency different than the order, the applicable Currency Spot Rate appears on the Payment Lines form.
Currency spot rates are applicable to the following areas within Aptify:
- Orders
- Cost of Goods Sold
- Payments and Scheduled Transactions
- Payments in a Currency Different from the Order's Currency
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When a foreign currency order is created, is marked as shipped, and is saved, the Mark-To-Market object automatically runs and creates an order currency spot rate.
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By default, Aptify's spot rate retrieval logic |
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U.S.es the order's Order Date when determining the correct spot rate. However, an administrator can specify whether a currency spot rate is retrieved based on an order's Order Date (the default behavior) or another date field associated with the Orders entity by |
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U.S.ing the DefaultDateForSpotRateCal attribute. See |
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for details. |
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Currency Spot Rate Order Example
An organization, whose functional currency is US U.S. dollar, takes an order on January 1st for 10 units of Widget A at ¥1200 per widget. The currency spot rate on the date of the order is ¥125 to $1 making the US U.S. dollar value of the transaction $96. A purchase order is provided as payment for the order which means that payment is not actually received in full at the time of the order. The order is marked as shipped and is saved, which causes caU.S.es Aptify to create an Order Currency Spot Rates record and the order GL entries.
The following Order Currency Spot Rates record is created to reflect the spot rate at the time the order is marked as shipped.
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Date | Account | Debit | Credit |
January 1 | Accounts Receivable | ¥12000 |
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January 1 | Sales |
| ¥12000 |
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When a foreign currency order is created and contains an order detail line for a product that is configured to track cost of goods sold (COGS), the Mark-To-Market object automatically runs and creates an Order Currency Spot Rates record when the order is marked as shipped. The currency spot rate is used U.S.ed to calculate COGS GL entries in terms of the foreign currency.
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An organization, whose functional currency is US U.S. dollar, takes an order on January 1st for 10 units of Widget A at ¥124 per widget. The currency spot rate on the date of the order is ¥122.65 to $1. The unit cost for each widget is $0.50 USD U.S.D per widget. The order is marked as shipped and is saved, which causes caU.S.es Aptify to create an Order Currency Spot Rates record and the order GL entries.
The following Order Currency Spot Rates record is created to reflect the spot rate at the time the order is marked as shipped.
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Date | Account | Debit | Credit |
January 1 | Accounts Receivable | ¥1,240.00 |
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January 1 | Sales |
| ¥1,240.00 |
January 1 | Cost of Good Sold | ¥613.25 |
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January 1 | Inventory |
| ¥613.25 |
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When a Payments record for a foreign currency order is initially saved, the Mark-To-Market object is called and stores the current currency spot rate with the order as an Order Currency Spot Rates record. A Scheduled Transactions record, with the Type field set to Mark A/R to Market, is also created to reflect the gain or loss in the organization's functional currency. If the gain or loss is zero, no Scheduled Transactions record is created.
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Currency Spot Rate Payment Example
An organization, whose functional currency is US U.S. dollar, takes an order on January 1st for 10 units of Widget A at ¥1200 per widget. The currency spot rate on the date of the order is ¥125 to $1 making the US U.S. dollar value of the transaction $96. Payment on the order is made on February 15th in the amount of ¥12000, but the currency spot rate at the time of the payment is ¥115 to $1 which means there is a gain in the value of the transaction because becaU.S.e of the change in the currency spot rate for that order. The US U.S. dollar value of the receivable increases to $104.35. When the Payments record is saved, Aptify creates another Order Currency Spot Rates record for the order, the payment GL entries, and the Scheduled Transactions record, which reflects the gain on this transaction ($104.35 - $96 = $8.35).
The following Order Currency Spot Rates record is created to reflect the spot rate at the time of the payment.
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Date | Account | Debit | Credit |
February 15 | Accounts Receivable | $8.35 |
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February 15 | Foreign Exchange Gain |
| $8.35 |
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When an organization accepts a payment in a currency that is different from the currency specified on the corresponding order, the system automatically retrieves the appropriate spot rate to compare the value of the payment with the amount applied to the order.
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On January 1st, an organization, whose functional currency is US U.S. dollar, takes an order on account for 10 units of Widget A at $10 per widget. On February 15th, the customer cU.S.tomer provides a €70 euro payment for this order (the payment is in euros but the order is in US U.S. dollars).
The current spot rate is €0.7004 to $1 (which corresponds to $1.4277 to €1). When a user opens a Payments record and specifies the Euro currency type, the system automatically retrieves this rate and calculates the $100 order balance in terms of Euros, which is €70.04.
However, the organization is accepting the €70 euro payment as payment in full for the order, which results in a (€0.04) conversion adjustment adjU.S.tment entry.
At the order level, the following GL entries are made when the order is shipped (in the order's currency, US U.S. dollar).
Date | Account | Debit | Credit |
January 1st | Accounts Receivable | $100.00 |
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January 1st | Sales |
| $100.00 |
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Date | Account | Debit | Credit |
February 15 | Cash | €70.00 |
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February 15 | Conversion AdjustmentAdjU.S.tment | €0.04 |
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February 15 | Accounts Receivable |
| €70.04 |
The $100 accounts receivable (A/R) debit on the order is offset by the €70.04 A/R credit on the payment. These two values are equivalent when the applicable spot rate is applied ($100 x 0.7004 = €70.04).