DIFFERENT TYPES OF CURRENCIES
TRANSACTION CURRENCY - Currency in which the transaction is denominated.
FUNCTIONAL CURRENCY - Currency in which company conducts its business. E.g., some Latin American companies might conduct business in USD because of high inflation rates.
LOCAL CURRENCY (currency type 10) - normally it is the functional currency of the country where the company code is registered; legal/statutory currency e.g., CAD for Canadian company.
PARALLEL CURRENCY - Not normally activated. If functional currency is not same as statutory currency, parallel currency can be activated. E.g., High inflation currency where there is a need to see both currencies at the transaction level. Defined at the company code. Company will have local currency plus two parallel currencies.
GROUP CURRENCY (currency type 30) - currency defined in client master; normally this is also the consolidation reporting currency for the group; If using Group Currency in FI it is advised to use Group currency in CO as well.
No comments:
Post a Comment