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Handling Multiple Currencies in SAP

SAP allows you to define 3 parallel currencies in addition to document currency. These currencies can be used for reporting valuation in different currencies.

Currency Types

Parallel currencies can be defined in OB22. You can choose the currencies from 5 available currencies as below.

  • 10 (Company Code Currency) - This is available as first currency by default. The value comes from the company code configuration (Check tcode OBY6).

  • 30 (Group Currency) – Group currency is same for the system. It is defined at the client level (Check tcode SCC4).

  • 40 (Hard Currency) – Hard currency is used for the countries with high inflation. This is defined at country level (check tcode OY01).

  • 50 (Index-based Currency) – Index-based currency is defined for external statutory reporting (such as tax reporting) in some countries with high inflation. This is also defined at country level (check tcode OY01 ).

  • 60 (Global Company Currency) – Global company currency is defined at company level (check tcode OX15).

First currency is always company code currency. You can define additional 2 parallel currencies from the remaining 4 currency types above.

Foreign Currency Valuation Configuration

Foreign currency valuation is done to prepare financial statements at a key date. All the foreign currency transactions are converted to desired currency at the key date. Here are the key pieces of config you need to maintain for valuation.

  • Valuation Method –Valuation method determines the method that will be used for valuation such as Moderate or Strict Lowest Value Principle. You also store Document type for posting and Exchange rate to be used for valuation.

  • Valuation Area –Valuation area is used to define which currency should be revaluated (Company code currency, Group currency etc). Valuation method is assigned to Valuation Area.

  • Accounting Principle –You define the accounting principle to apply certain accounting rules such as US GAAP or IFRS. Valuation area is assigned to Accounting principle. Accounting principle is then assigned to Ledger group.


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