Configure Currencies for a Set of Contract Terms

Security Note: You need the Allow contract maintenance security right in the Contracts domain security rights group for this activity.

Activity Steps

Open the Sales Contract or Purchase Contract.
Select the node for the specific set of contract terms.
Select the Currencies tab.
Update the primary Currency if required. A currency hierarchy applies throughout the contract terms, such that if no currency is defined on a lower level, this currency is used. Select from the currencies defined in the Currency/Exchange Editor.
Enter the number of Decimal Places if required. This setting controls the number of decimal places used for the Invoice Item Value for line items in snapshots and invoices. If left blank, the number of decimal places defined for this currency in the Currency/Exchange Editor is used. This setting applies to invoice line items only and does not affect total and due amounts.
To specify a secondary currency and exchange rates:
1. Select the Secondary Currency. This currency may be used by the company's own back-office system or chart of accounts. Amounts in this currency can be displayed on invoices or exported to the company's ERP system. Select from the currencies defined in the Currency/Exchange Editor.
2. Enter the Secondary Decimal Places if required. This setting controls the number of decimal places used for the Secondary Invoice Item Value for line items in snapshots and invoices. If left blank, the number of decimal places defined for this currency in the Currency/Exchange Editor is used. This setting applies to invoice line items only and does not affect total and due amounts.
3. Enter either the primary Exchange Rate Source and primary Exchange Rate Method, or the Secondary Exchange Rate Source and Secondary Exchange Rate Method, because only one calculation, either forwards or backwards, is required to calculate one currency from the other.
  The exchange rate source is used to determine the exchange rate to the primary currency used by the contract. If actual exchange rates are not available, forward exchange rates can be used in despatch order snapshots and contract quota snapshots to estimate future currency values in invoice previews. See Specify Snapshot Settings for configuration required to estimate exchange rates. Only actual exchange rates are used in invoice calculations. Select from the exchange rate sources defined in the Currency/Exchange Editor.
  Select the exchange rate method from:
  - Average Quotation Period—The exchange rates for the quotation period (QP) are averaged, and the result is used to convert the price value into the currency of the QP.
  - Daily Quotation Period Average—The price value is converted into the currency of the QP for each day of the QP, and these converted values are then averaged.
  - Date Of Invoice
  - Previous Month Average
  - Last Day Of Previous Month—Uses the last business day of the previous month if a calendar is specified for the exchange rate source.
  - Day Before Invoice Date—Uses the last business day before the invoice date if a calendar is specified for the exchange rate source.
  - Last Known Exchange Rate
  - Bill Of Lading—If the bill of lading date is a non-working day in the applicable calendar, uses the exchange rate from the previous business day.
  - Day Before First Invoice Date—Uses the last business day before the date of the first commercial invoice if a calendar is specified for the exchange rate source.
Select whether to Use Sum Of Invoice Line Items As Secondary Currency Total.
If checked, the secondary currency total is calculated as the sum of the invoice line items that have been converted into the secondary currency. If unchecked, the secondary currency total is converted from the invoice total in the primary currency. In most cases, the total will be exactly the same with either method. However, if journals do not balance because of rounding issues in the currency conversion, using the sum of the invoice line items as the secondary currency total may resolve the difference in the journals.
To specify default exchange rates for the contract terms:
1. Select whether to Use Default Exchange Rates. If unchecked, default exchange rates can still be specified; however, they are not used in any calculations on despatch order snapshots or invoices. If checked, the specified default exchange rates are used if all the following conditions apply:
  - An exchange rate is required to calculate values on the despatch order snapshot or invoice.
  - The required exchange rate does not exist for the exchange rate source (in the Currency/Exchange Editor).
  - A specified default exchange rate matches the required combination of currencies and invoice type.
  Note: If there is no specified default exchange rate between the required source and destination currencies (for example, AUD to USD), but there is a default exchange rate in the opposite direction (that is, USD to AUD), the specified rate is inverted (1 / rate) and used.
2. Right-click in the Default Exchange Rates table and select New from the menu.
3. Complete the following fields.
  - Source Currency
  - Target Currency
  - Exchange Rate—Exchange rate between the source and target currencies, such that:
```
Source Currency * Exchange Rate = Target Currency
```
4. To limit the default exchange rate to specific invoice types, specify the Invoice Types. If no invoice types are selected, the exchange rate can be used for all invoice types. Select from the invoice types defined on the Invoice Types screen.
  Note: Multiple default exchange rates can be specified, as long as the combinations of source currency, target currency and applicable invoice types are unique.
5. To delete a default exchange rate, right-click the rate and select Delete from the menu.
Click Save.