Financial Initialization

SAP Business One supports three types of currencies:

Local Currency - This is, in most cases, the formal currency of the country. In SAP Business One, all the reports displayed in the local currency, and all the foreign currency transactions are translated automatically to local currency. This way, the local currency is the common denominator for all currencies, which enables balance calculation of accounts/business partners specified as All Currencies .

System Currency - This currency is parallel to the local currency, meaning, all the transactions in SAP Business One, in all currencies (local and foreign) are translated automatically to the system currency as well as to local currency. The system currency supports companies that create reports in a currency that is different from the local currency (for example, European subsidiary company which reports to American parent company), by enabling the conversion and revaluation of the reports to the system currency.

Foreign Currency - All the currencies other then the local currency. The foreign currencies are defined by the user in SAP Business One according to the company's requirements.

Conventional Unit (Russia) - support the need of companies to define virtual currencies due to local currency fluctuations. A currency specified as Conventional Unit acts as any other foreign currency, except for when exchange rate differences take place. The rate of the conventional unit in the local currency is defined upon agreement between the company and its business partners.

In SAP Business One users can specify G/L accounts and/or business partners as All currencies . This allows the user to post to these G/L accounts and/or business partners documents and journal transactions of any currency defined in the SAP Business One company. Reconciliations, reports and balances of All-Currencies G/L accounts and/or business partners are performed, calculated and displayed in the local currency only.

Enables the user to choose one of the following rounding methods:

By Currency - Supports working with rounding account in which the rounding differences are posted. In this method the rounding is made for each currency individually, according the parameters defined by the user.

By Document - Relevant only for sales document. In this method there is no rounding account, and the rounding differences are displayed in the rounded document as discount.

In Czech Republic, Hungary, Poland, Russia, and Slovakia the only rounding method available is By Currency .

Enables the user to create manually or import automatically opening balance transactions for G/L accounts and business partners and opening quantities for inventory items.

Enables the user to enter the updated exchange rates of all the foreign currencies defined in SAP Business One and any required indexes. The exchange rates that are entered in the table are used in foreign currency transactions, and the indexes are used when revaluations take place.

SAP Business One supports two methods of exchange rate calculation: direct and indirect. For example, if the local currency is US Dollar, and the selected method is Direct, the user inserts the rate according to the foreign currency (How many Euros are worth one Dollar).

while if the selected method in the same company is Indirect, the user inserts the rate according to the local currency (How many Dollars worth one Euro).

Both exchange rates table and indexes table can be imported and exported from one company in SAP Business One to another.

Enables the user to determine default G/L accounts and default control accounts to be used when journal transaction are created. The user can change the control account for business partner when creating manual journal entries.

Users can quickly and easily generate any number of financial report templates for any purpose, such as generating additional profit and loss statements.