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Foreign Currency Issues

Each unit is designated a Currency Types and Options, as well as exchange rates that are used to convert the unit's local currency information to reporting currency. Enter 1 for the exchange rate if the local and reporting currency are the same currency.
In converting currency, there are several potential issues that can occur. The Pre-Tax Book Income (PTBI) provided may be converted at different exchange rates. On a unit basis, the Pre-Tax Book Income (Report) can be selected so that the correct exchange rate is used to convert. The interplay of the Weighted Average and Spot rates may require that a Change in Rate and Currency Translation (CTA) be posted to account for the difference in rates. The system automatically posts the CTA as an equity adjustment to the deferred tax asset/liability.
There is only one reporting currency concept in the system. This allows the combination of units in sub-consolidated or consolidated reports in the reporting currency view. The local currency view of the report may not make sense unless all units have the same currency.

This article applies to:

  • PRODUCT: ONESOURCE Tax Provision