Some balance sheet accounts are translated at historical rates, meaning that the standard balance sheet translation methodology using the period end rate does not apply. This is one of the requirements unique to foreign entities in a multi-currency organization.
FCC provides 2 options to override the standard translation for these accounts.
- Historical Rate Override
- Historical Amounts Override.
For the override entry to correctly override the translation amount in FCC, the override rate/amount must be entered at the same intersection (all dimensions) where the functional currency activity exists. The overrides amount entered (for the reporting currency) only overrides the current period activities.
This blog focus on the required configuration in Data Management (DM) for loading override data.
- The Exchange Rate Type property for the account should be set to Historical Amount Override or Historical Rate Override
- Add the Currency dimension with the Expression set to “USD”
Create USD Override Location with the following settings
- The Currency dimension should be set to the required reporting currency. In this example, USD
- The Expression “NZP” in the Amount row allows you to load zero amount, if required
- Update the source and target mapping for all dimensions. It is easier to pre-map the dimensions in the data load file
- Upload the override file and save
- Execute the DLR for the specified POV
- Below is the USD Override data in workbench after successful data load
- Notice that the Currency columns is USD
- The screenshot below shows the pre-USD override input for entity 3000 (GBP). With a period-end rate of 1.350518. On translation, £20,000 = $27,003 in the common stock account
- When a USD override amount of $28,000 is loaded from DM, the new translated amount in USD reporting currency equals $28,000 (overriding the pre-override amount of $27,003)
In organizations with lots of periodic activities in the historical accounts, DM is the most efficient tool for loading the override data compared to data forms. This also offers a reference point as all loaded override amount can be viewed in Workbench.