R12 GL Multi Currency (MRC) Revaluation and Translation Video Series (Doc ID 2435928.2)

9/5/24, 18:14 Note: 2435928.
Note: 2435928.2
Copyright (c) 2024, Oracle. All rights reserved. Oracle Confidential.
Translation
NOTE: In the images or examples below and/or the attached document, user details / company name / address / email / telephone number represent a fictitious sample (based upon made up data used in the Oracle Demo Vision instance).
Any similarity to actual persons, living or dead, is purely coincidental and not intended in any manner.
Translation:
Translation is a process which translated your functional currency amounts to another currency at the account balances level. You can translate both actual and budget balances.
If you have average balance processing enabled for your ledger, then you can translate average as well as standard balances.
When to Run Translation:

Translation is used to report the functional currency balances into other currencies as per the business requirement so that the consolidated reports can be prepared
This is a period end activity. Run translation after you have completed all journal activity for an accounting period. If you post additional journal entries or change your translation rates after running translation for a period, you must retranslate.
Additionally, if you change the account type for an account segment value and want to retranslate your actual account balances, you must re-enter or change the period-end and average exchange rates for the periods you want to retranslate.
What Rates are Considered for Translations?

Following flow chat explains what rate will be considered for calculation based on the account type and profile option setup:
https://support.oracle.com/epmos/faces/DocumentDisplay?_afrLoop=411660402902024&id=2435928.2&_afrWindowMode=0&_adf.ctrl-state=jmgf32r1u_4 1/14
9/5/24, 18:14 Note: 2435928.2
What Balances Will be Considered?

Following flow chat explains what balances will be considered for calculation based on the account type and profile option setup:
9/5/24, 18:14 Note: 2435928.2
Translation Formula:
There are two formulas which Translation uses to calculate the translated amounts:
YTD Method: Used for following Account Types:
1. Asset
2. Liability
3. Ownership's Equity(Profile Option: GL: Owners Equity Translation Rule is set to YTD)
PTD Method: Used for following Account Types:
1. Expense
2. Revenue
3. Ownership's Equity(Profile Option: GL: Owners Equity Translation Rule is set to PTD)
And the formulas are:
YTD Method:
Initial Translated Debit Balance = End Translated Debit Balance of previous period
Initial Translated Credit Balance = End Translated Credit Balance of previous period
9/5/24, 18:14 Note: 2435928.2
Period Translated Net Debit = (Initial Functional Debit Balance + Period Functional Net Debit) * Rate - Initial Translated Debit Balance
Period Translated Net Credit = (Initial Functional Credit Balance + Period Functional Net Credit) * Rate - Initial Translated Credit Balance
End Translated Debit Balance = Initial Translated Debit Balance + Period Translated Net Debit
End Translated Credit Balance = Initial Translated Credit Balance + Period Translated Net Credit
PTD Method:
Initial Translated Debit Balance = End Translated Debit Balance of previous period
Initial Translated Credit Balance = End Translated Credit Balance of previous period
Period Translated Net Debit = Period Functional Net Debit * Rate
Period Translated Net Credit = Period Functional Net Credit * Rate
End Translated Debit Balance = Initial Translated Debit Balance + Period Translated Net Debit
End Translated Credit Balance = Initial Translated Credit Balance + Period Translated Net Credit
Following are the Prerequisites to perform Translation:
1. Define a period in your calendar that precedes the first period you want to translate.
2. Define a period in your calendar following the period you want to translate.
3. Enter period and historical rates for your target currency.
4. Review the setting of the profile option GL: Owners Equity Translation Rule. If necessary, have your system administrator change the setting. See: Notes on Translating Owners' Equity Accounts
5. If you are translating budgets, define your source and target budgets.
Follow the below steps to perform Translation:

To translate actual account balances to a foreign currency:
1. Navigate to the Translate Balances window.
General Ledger displays the Functional Currency for your set of books as the currency you are translating.
2. Select Actual for the Balance Type to translate.
3. (Optional) If average balance processing is enabled in your set of books, select a Usage:
Standard: To translate standard balances only.
Average: To translate average balances only.
Both: To translate both standard and average balances.
4. Mark the All checkbox to translate balances for all balancing segment values, or enter a single Balancing Segment Value for which you want to translate balances.
5. Enter the Target Currency to which you want to translate. You can choose any enabled currency other than your functional currency.
6. Enter the Period of the balances you want to translate.
Attention: The Period you enter the first time you translate actual balances will be the earliest period for which you can translate actual balances for any subsequent translations.
7. Choose the Translate button to begin a concurrent process to translate account balances. General Ledger displays the request ID (Req ID).
Additional Information: Translating both standard and average balances generates two separate concurrent requests; one to translate standard balances and one to translate average balances. Both request IDs will be displayed in the Req ID field.
To translate budget balances to a foreign currency:
General Ledger displays the Functional Currency for your set of books.
2. Choose Budget as the Balance Type to translate. If average balances are enabled for your set of books, the Usage field will display Standard and cannot be changed.
9/5/24, 18:14 Note: 2435928.2
3. Mark the All checkbox to translate balances for all balancing segment values, or enter a single Balancing Segment Value for which you want to translate balances.
5. Enter the Period of the balances you want to translate. You can translate budget balances for any period regardless of the period you choose to translate first.
6. Enter the Source budget whose account balances you want to translate, and the Target budget for which you want to calculate translated account balances. You can translate one source budget into one or more target budgets.
Attention: You should not translate more than one source budget into the same target budget for the same period and currency because each source budget translation will override the balances in your target budget.
The budget year containing the period you are translating must be open in your source budget.
Points to be Noted:
1. You cannot translate in the first period in your calendar.
So, define an extra period previous to the period from which the balances are to be translated.
2. Translation of the current period will automatically retranslate all prior periods where the translation is not current status.
9/5/24, 18:14 Note: 2435928.2
References:
Following are the few references which can help in understanding the functionality of Translation:
General Ledger - Advanced Resolution Center (Doc ID 2126127.2)

General Ledger FAQ for Balances Translation (Doc ID 1499690.1)
General Ledger Translation Rate Adjustment FAQ (Doc ID 296272.1)
Troubleshooting Currencies, Translation, Revaluation (Doc ID 120086.1)
How Does the Translation Process Calculate the Translated Amounts? (Doc ID 188530.1)
9/5/24, 18:14 Note: 2435928.2
Translation Videos
Translation Videos
Translation Explained
2435928.2-EBS-Translation Explained

1. When to Run Translation?

2. What Rates are Considered
3. What Balances are Considered
4. Translation Formula
5. Prerequisites
6. Points to be Noted
  0:00 / 7:29  1x  
Translation Demo
9/5/24, 18:14 Note: 2435928.2
To translate actual account balances to a foreign currency:
General Ledger displays the Functional Currency for your set of books as the currency you are translating.
2. Select Actual for the Balance Type to translate.
3. (Optional) If average balance processing is enabled in your set of books, select a Usage:
Standard: To translate standard balances only.
Average: To translate average balances only.
Both: To translate both standard and average balances.
4. Mark the All checkbox to translate balances for all balancing segment values, or enter a single Balancing Segment Value for which you want to
translate balances.
6. Enter the Period of the balances you want to translate.
Attention: The Period you enter the first time you translate actual balances will be the earliest period for which you can translate actual balances for
any subsequent translations.
Additional Information: Translating both standard and average balances generates two separate concurrent requests; one to translate standard balances
and one to translate average balances. Both request IDs will be displayed in the Req ID field.
Revaluation
Revaluation
Revaluation:
Revaluation is a process which identifies the Unrealized Gain/Loss based on the change in the conversion rate form the date of the journal entry to the Revaluation rate at period end
General Ledger posts the change in the converted balances against the unrealized gain/loss account you specify while running the revaluation.
You can run the revaluation for a single account or a range of accounts at a time.
When to Run the Revaluation?

Revaluation is a part of period end activity to know the unrealized gain or loss because of the change in the conversion rate so that the financials reports can be prepared/published.
General Ledger currency revaluation is only for reporting purpose and so all the revaluations journals has to be reversed in the next accounting period.
What Balances Will be Considered for Revaluation?

Revaluation will consider either PTD or YTD balances based on the account type and the profile option setup.
1. Balance Sheet Accounts(Asset, Liability and Ownerships Equity) will always consider YTD Balances.
9/5/24, 18:14 Note: 2435928.2
2. Profit and Loss Accounts(Expense and Revenue) will consider either PTD or YTD balances based on the profile option "GL: Income Statement Accounts Revaluation Rule".
a. PTD: will consider PTD Balances
b. YTD: Will consider YTD Balances
NOTE: Formula for revaluation is different for PTD and YTD.
Business Scenario:
Vision Corporation is an Indian based company where they do business with US Companies.
Currencies
Functional Currency INR
Foreign Currency USD
Consider they ordered 10 units of machinery on 1st Aug 2018 for their business purpose.
Each costs $1000.
So, their Liability as on 1st Aug 2018 is:
1000 * 10 = $10000.
As, the business is in India, business has to pay in INR.
1st Aug 2018 Conversion Rate

Date From_Currency To_Currency Conversion_Type Conversion Rate
01-Aug-2018 USD INR Training_Corporate 60
When converted into INR, Liability becomes:
10000 * 60 = 600000 INR
Say suppose, if this amount is not settled(Paid) by the end of the month. At the end of the period, when the business want to publish the reports, all the balances must be as on date.
Take the rate at the period end i.e. 31st Aug 2018 is 75
31st Aug 2018 Conversion Rate

Date From_Currency To_Currency Conversion_Type Conversion Rate
31-Aug-2018 USD INR Training_Corporate 75
So, their Liability as on 31st Aug 2018 is:
10000 * 75 = 750000 INR
Liability is increased by 150000 INR and this is because of the fluctuations in the currency conversion rates.
As this is not yet settled(Paid) this is considered as an Unrealized Loss and the process of calculating Unrealized loss or Gain is Revaluation.
Revaluation Formula:
Revaluation will consider either PTD or YTD balances formula as per the account type and profile option setup
9/5/24, 18:14 Note: 2435928.2
YTD Balances formula is used for below account types:
1. Asset
2. Liability
3. Ownership's Equity
4. Expense (If profile option "GL: Income Statement Accounts Revaluation Rule" is set to YTD)
5. Revenue (If profile option "GL: Income Statement Accounts Revaluation Rule" is set to YTD)
PTD Balances Formula for:
1. Expense (If profile option "GL: Income Statement Accounts Revaluation Rule" is set to PTD)
2. Revenue (If profile option "GL: Income Statement Accounts Revaluation Rule" is set to PTD)
Formula for YTD Balances:
ACCOUNT AMOUNT =
((begin_balance_dr + period_net_dr - begin_balance_cr - period_net_cr) * revaluation_rate)
LESS
(begin_balance_dr_beq + period_net_dr_beq - begin_balance_cr_beq - period_net_cr_beq)
Formula for PTD Balances:
ACCOUNT AMOUNT =
((period_net_dr - period_net_cr) * revaluation_rate))
LESS
(period_net_dr_beq - period_net_cr_beq)
Following are the prerequisites to perform Revaluation:
1. Define an unrealized gain/loss account.

2. Define a revaluation rate for each currency for each period for which you want to run revaluation.
Steps for Revaluation:

Following are the setup for revaluation:
1. Make sure that the Conversion rates are defined for the date on which the revaluation needs to be run.
2. Navigate to Revaluation Window
a. Navigate to Currency > Revaluation
3. In the Revaluation Window
a. Provide Name for the Revaluation
b. Select AutoPost Revaluation if want to post the revaluation journal created
c. In Currency Options, you have two values:
i. All Currencies: Allows you to run the revaluation for all the currencies in single go. Creates single batch having separate journal for each currency
ii. Single currency: Allows to run revaluation only for single currency
d. In Rate Options, you have two values:
i. Daily Rates: Allows user to run the revaluation using conversion type
ii. One Time: It is a manual entry. user can enter a rate with which they want to run the revaluation directly
e. Accounts Range: Select the accounts for which the revaluation needs to be run. Can be single account or a range of accounts.
f. Click on Revalue
4. This will navigate you to SRS window with a program "Program - Revalue Balances" where we need to select the parameters
a. Select the Period for which the revaluation needs to be run
b. Select the effective date of the journal
c. Select the revaluation date. This is the date for which the revaluation checks for the rate.
d. Click Ok and Submit
5. Once the "Program - Revalue Balances" is completed, click on View Output. This will provide us the Revaluation batch created.
6. Copy the journal and query it in the front end. Navigation: Journals > Enter
9/5/24, 18:14 Note: 2435928.2
7. Provide the journal name and click on review journal.
You can see only the accounted amounts populated, because the foreign currency balance will never change because of the fluctuations and it is the functional currency balance which is going to change.
Following are the few points to be notes while running revaluations:
1. When you run revaluation, General Ledger creates a revaluation batch containing a separate journal entry for each revalued foreign currency.
2. General Ledger creates the revaluation adjustments in your functional currency.
3. General Ledger automatically defines the reversal period as the next accounting period.
4. When you revalue balances in an average balance ledger, General Ledger only revalues standard balances.
5. When you post the revaluation journal entries to update your standard balances, the system will recompute your average balances automatically
6. It is mandatory to reverse the revaluation journals in the next period as revaluation is only for reporting purpose
7. Revaluation can be run any number of times for a period, provided, all the previous revaluation journals in the period are posted. If there are any additional journal entries posted in the period, only these balances will be considered for the revaluation. Another
separate revaluation journal will be created for this incremental balance.
9/5/24, 18:14 Note: 2435928.2
References:
Following are the few references which can help in understanding the functionality of Revaluation:
General Ledger - Advanced Resolution Center (Doc ID 2126127.2)
General Ledger FAQ for Balances Revaluation (Doc ID 1499687.1)
What Is The Formula Used By Revaluation Process? (Doc ID 119697.1)
How Does Revaluation Work? (Doc ID 187404.1)
9/5/24, 18:14 Note: 2435928.2
Revaluation Videos
Revaluation Videos
Revaluation Explained
1. What is Revaluation?
2. When to run the Revaluation?
3. What balances will be considered?
4. Revaluation Formula
5. Points to be noted
Revaluation Demo
9/5/24, 18:14 Note: 2435928.2
Following are the setup for revaluation:
1. Make sure that the Conversion rates are defined for the date on which the revaluation needs to be run.
2. Navigate to Revaluation Window
a. Navigate to Currency > Revaluation
3. In the Revaluation Window
a. Provide Name for the Revaluation
b. Select AutoPost Revaluation if want to post the revaluation journal created
c. In Currency Options, you have two values:
i. All Currencies: Allows you to run the revaluation for all the currencies in single go. Creates single batch having separate
journal for each currency
ii. Single currency: Allows to run revaluation only for single currency
d. In Rate Options, you have two values:
i. Daily Rates: Allows user to run the revaluation using conversion type
ii. One Time: It is a manual entry. user can enter a rate with which they want to run the revaluation directly
e. Accounts Range: Select the accounts for which the revaluation needs to be run. Can be single account or a range of accounts.
f. Click on Revalue
4. This will navigate you to SRS window with a program "Program - Revalue Balances" where we need to select the parameters
a. Select the Period for which the revaluation needs to be run
b. Select the effective date of the journal
c. Select the revaluation date. This is the date for which the revaluation checks for the rate.
d. Click Ok and Submit
5. Once the "Program - Revalue Balances" is completed, click on View Output. This will provide us the Revaluation batch created.

R12 GL Multi Currency (MRC) Revaluation and Translation Video Series (Doc ID 2435928.2)

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

R12 GL Multi Currency (MRC) Revaluation and Translation Video Series (Doc ID 2435928.2)

Uploaded by

Copyright:

Available Formats

9/5/24, 18:14 Note: 2435928.

When to Run Translation:

What Rates are Considered for Translations?

What Balances Will be Considered?

YTD Method: Used for following Account Types:

PTD Method: Used for following Account Types:

And the formulas are:

Period Translated Net Debit = Period Functional Net Debit * Rate

Period Translated Net Credit = Period Functional Net Credit * Rate

Following are the Prerequisites to perform Translation:

Follow the below steps to perform Translation:

1. Navigate to the Translate Balances window.

2. Select Actual for the Balance Type to translate.

Standard: To translate standard balances only.

Average: To translate average balances only.

Both: To translate both standard and average balances.

6. Enter the Period of the balances you want to translate.

To translate budget balances to a foreign currency:

1. Navigate to the Translate Balances window.

1. You cannot translate in the first period in your calendar.

Copyright (c) 2024, Oracle. All rights reserved. Oracle Confidential.

General Ledger - Advanced Resolution Center (Doc ID 2126127.2)

Copyright (c) 2024, Oracle. All rights reserved. Oracle Confidential.

1. When to Run Translation?

To translate actual account balances to a foreign currency:

1. Navigate to the Translate Balances window.

2. Select Actual for the Balance Type to translate.

Standard: To translate standard balances only.

Average: To translate average balances only.

Both: To translate both standard and average balances.

6. Enter the Period of the balances you want to translate.

Copyright (c) 2024, Oracle. All rights reserved. Oracle Confidential.

When to Run the Revaluation?

What Balances Will be Considered for Revaluation?

Each costs $1000.

So, their Liability as on 1st Aug 2018 is:

As, the business is in India, business has to pay in INR.

1st Aug 2018 Conversion Rate

When converted into INR, Liability becomes:

10000 * 60 = 600000 INR

31st Aug 2018 Conversion Rate

So, their Liability as on 31st Aug 2018 is:

10000 * 75 = 750000 INR

PTD Balances Formula for:

((begin_balance_dr + period_net_dr - begin_balance_cr - period_net_cr) * revaluation_rate)

(begin_balance_dr_beq + period_net_dr_beq - begin_balance_cr_beq - period_net_cr_beq)

Formula for PTD Balances:

((period_net_dr - period_net_cr) * revaluation_rate))

Following are the prerequisites to perform Revaluation:

1. Define an unrealized gain/loss account.

Steps for Revaluation:

Following are the few points to be notes while running revaluations:

Copyright (c) 2024, Oracle. All rights reserved. Oracle Confidential.

General Ledger - Advanced Resolution Center (Doc ID 2126127.2)

General Ledger FAQ for Balances Revaluation (Doc ID 1499687.1)

What Is The Formula Used By Revaluation Process? (Doc ID 119697.1)

How Does Revaluation Work? (Doc ID 187404.1)

Copyright (c) 2024, Oracle. All rights reserved. Oracle Confidential.

Following are the setup for revaluation:

You might also like