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R2R Discussion

There are two types of currencies a company uses: base currency and foreign currency. Enabling multiple currency features allows transactions in currencies other than the base and assigning multiple currencies per entity. Currency exchange rates are required to convert transactions in foreign currencies to the base currency for financial reporting. The exchange rates can be manually entered or automatically updated through integration with providers.

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Raymond Monton
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99 views2 pages

R2R Discussion

There are two types of currencies a company uses: base currency and foreign currency. Enabling multiple currency features allows transactions in currencies other than the base and assigning multiple currencies per entity. Currency exchange rates are required to convert transactions in foreign currencies to the base currency for financial reporting. The exchange rates can be manually entered or automatically updated through integration with providers.

Uploaded by

Raymond Monton
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Multiple currencies

There are 2 kinds of currency a business or company uses namely: Base currency and Foreign currency.
When we say Base currency, it is the currency used by the company or subsidiary to manage its financial
records. The counter part of Base currency is called foreign currency. Foreign currency are currencies
other than the base currency.

Since currency plays a big role in a company’s transactions, we should consider it in our NS
implementation. Your company’s base currency is set through your Company Information (Setup
>Company > Company Information) choose the country from the Currency Locale field. By default, In
NetSuite you are not allowed to perform a transaction with an entity/party that uses a currency
different from your base currency.

But by enabling Multiple Currency features, you will be allowed to conduct transactions such as making
sale or purchase with entities using a currency different from your base currency. It is possible because
the system will allow you to assign more that one currency to an entity record/subsidiary. Once It is
enabled, you can now see an additional list in your list tab: Currency and Currency Exchange rate. In the
Currency List, you can see the list of currency you have. If you back to your Company information, the
Customer locale field is now replaced with Currency field that is sourcing its values from the currency
list. By clicking this Plus sign, you can now create a new currency record in the fly. (Demo on how create
a currency record). While in the Currency exchange rate list, you can see the list of foreign currency
exchange multiplier used to convert your base currency to other foreign currency. Currency exchange
rate list will be further discussed in the later part of my presentation. Just like what I’ve told earlier, by
enabling this feature gives the user the ability to assign more than one currency in a customer/vendor
record. Under the financial subtab of the two records, a Currency sublist will be seen and that is where
you assign currency to your customer/vendor record. If you are using a Oneworld account, the primary
currency of the subsidiary you choose for your subsidiary field will always be found in your currency
sublist even if you remove it prior to saving the record. Once have entered a record with multiple
currency, you won’t be able to disable this feature unless you will delete those records.

Since you might be using currencies other than your base currency in your transactions but still you need
to report your financial using your base, that’s why you need Currency exchange rate. Currency
exchange rate is the exchange rate between the base currency and foreign currencies. You can see your
Currency exchange rate list in the List tab > Accounting. In the base currency column, you can see all the
currencies set as base. For example, if you are using a Oneworld account and you have 3 subsidiaries
with different base currencies, you will see 3 currencies here. It is read as 1 (base currency) is equal to
(exchange rate) (source currency). There are 3 ways to update your Currency exchange list. First is
through creating new currency exchange rate. (Do sample), you can also do a mass update using CSV
update. (Do sample). You can also enable the Currency Exchange Rate Integration feature. Your
Currency exchange list will be automatically updated at 12:30AM PST. Providers are Xignite and
Thomson Reuters. By going to Accounting pref > General Subtab > Exchange rate integration You can
choose your preferred provider. There is also the Use triangulation calculation by netsuite permit
NetSuite to use cross currency triangulation to calculate the exchange rate for a transaction where the
two home currencies are not available from the selected rate provider. You can choose whether a
currency be automatically updated by going to your currency list, there will be Automatic update
checkbox. It refers whether that currency is to be updated automatically using the Currency exchange
integration feature.
If you are using a OneWorld account and your subsidiaries have different base currency then you will be
needing Consolidated Exchange rate. Consolidated Exchange rate provides consolidated management
reporting and financial statements. The purpose of this is to ensure that for consolidation purpose,
currency amounts properly rolls up from child to parent. It is set per accounting periods.

Now I will be discussing Currency exchange rate. Currency exchange rate is the exchange rate between
the base currency and the other foreign currencies. If you enabled the Multiple currency features it
means that you are transacting using different currencies but you need to report those transactions in
one currency which is your base currency.

Currency exchange rate integration- automatically updates list of currency exchange rates . Xignite and
Thomson Reuters.

-if not tusing multiple currenct currency exchange rate is updated at 12:30 AM PST.

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