8/10/2019 96 - Valuation During GR for Foreign Currency Purchase Order

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SAP Note 

Header Data

Symptom 

When you post a goods receipt for a foreign currency purchase order (for example EUR) with the localcurrency being DEM, for example ...

1)... the amount of the inventory posting in the local currency is identical with the amount of theinventory posting in the foreign currency.With an exchange rate between DEM and EUR of 1:1.95583, this seems to be incorrect.

2)

... the relationship of the amount of the inventory posting in the foreign currency and the amountof the inventory posting in the local currency does not correspond to the exchange rate.

Other Terms 

EURO, rounding, valuation, MMVAL

Reason and Prerequisites 

The described behavior is caused by rounding.

l Example:

¡ 2000 pieces of material A for EUR 0.5 / 100 pieces are ordered.

¡ The material has a standard price of DEM 0.01 / 1 piece in the local currency.

¡ For the goods receipt of 2000 pieces, the system creates the following postings:

¡ Local currency in DEM:Inventory posting (BSX) 2000 pieces * DEM 0.01 / piece 

= DEM 20 GR/IR posting (WRX) (EUR 0.5 / 100 pieces) * 1.95583 * 

2000 pieces = DEM 19.56 

Price difference (PRD) DEM 20 - DEM 19.56= DEM 0.44 

¡

Foreign currency EUR:Inventory posting (BSX) DEM 0.01 / piece / 1.95583= 0.00511... = EUR 0.01 / piece (rounded) --> 2000 piece * EUR 0.01 / piece= 20 EUR 

GR/IR posting (WRX) 2000 pieces * EUR 0.5 / 100 pieces = EUR 10 

Price difference (PRD) EUR 20 - EUR 10= EUR 10 

You can find an explanation for the posting of logic foreign currency purchase orders inNote 191927.

Solution 

No rounding problems occur when you calculate the postings in local currency.When you calculate the inventory posting in the foreign currency (Document currency), the price wasrounded, therefore, the relationship between local currency amount and foreign currency amount doesnot always correspond to the conversion factor. Since the stock accounts are managed in localcurrency, the amounts in document currency are only of informative nature. If you want to avoid thisproblem, SAP recommends to increase itself the price unit. In our example, this corresponds to anincrease of the price unit to 1000. This results in a new price of DEM 10 / 1000 pieces.

Read on if the purchase order was created in EUR and you must still carry out a local currencychange in EUR.

373296 - Valuation during GR for foreign currency purchase order  

Version  6 Validity: 28.03.2001 - active Language  English

Released On  27.03.2001 22:00:00

Release Status Released for Customer

Component  MM-IM-GF-CURR Goods Movements in Foreign Currencies

Priority  Recommendations / Additional InfoCategory  Consulting

8/10/2019 96 - Valuation During GR for Foreign Currency Purchase Order

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Implement Note 388502 to your system, so that the following 'move problem' can be prevented.

You must check all materials with very small price since after the local currency conversionmaterials can be contained in your system that have a new price of EUR 0 due to rounding differencesIn order to avoid this effect, SAP recommends here to adjust the price unit correspondingly as well.For this, also take Note 145920 into account.

What happens with the above-mentioned documents during the local currency change?

1. If an EURO amount exists as a foreign currency amount in the FI document, this amount is usedas a new local currency amount (so-called MOVE logic). That is, in this case the local currencyamount is replaced by the foreign currency amount during the conversion (FI document lines intable BSEG).

2. In our example, the DEM 20 of the inventory posting are therefore converted in EUR 20 in theFI document (BSX posting).before the conversion phase: BSEG-DMBTR = DEM 20 BSEG-WRBTR = EUR 20converted value: BSEG-DMBTR = EUR 10.23 BSEG-WRBTR = EUR 20after conversion phase: BSEG-DMBTR = EUR 20 BSEG-WRBTR = EUR 20

If there is a variation as in this example, these amounts are stored in table EWUFI_CDOC:EWUFI_CDOC-DMBTR_CONV = EUR 10.23EWUFI_CDOC-DMBTR_MOVE = EUR 20.You find a report for the summation of such differences for an account in Note 213669.

3. The value of the material in the material master is converted.It is assumed that only this material document exists for this material. As a consequence, thestock value is = DEM 20 (MBEW-SALK3). This amount is converted into 10.23 EUR.

4. Then the amounts are converted in the FI accounts.In this example only material A is supposed to post onto the FI G/L account. As a consequence

the balance on this account is DEM. This is converted into EUR 10.23.

5. Afterwards, comparison program SAPF070 finds out in FI that the totals of the FI documentsare not equal to the balance of the G/L account and adjusts the balance of the account on thebasis of the documents.In this example, the EUR 20 of the FI document are compared with the EUR 10.23 of the FIaccount. Since the totals of the FI documents must correspond to the balance, the balance ischanged in the material stock account to EUR 20.

6. After this, report EWUMMBST is started. It compares the totals of the stock values of thematerials with the balance in the corresponding material stock accounts (same function as reportRM07MMFI).In our example, the stock value in the material master is EUR 10.23. However, a sum of EUR 20(DEBITS) is in the account.This difference of EUR 9.77 is held by report EWUMMBST(_40) in table EWUMMFI. In the POST phaseof the EURO conversion, report EWUMFPST then creates a Euro adjustment posting (in batch withTransaction FBB1). In this example, the adjustment posting should post the following:

Material stock account: EUR 9.77 credit EURO adjustment account, class 004: EUR 9.77 debit You can make a transfer posting of the difference of EUR 9.77 from the adjustment account to theinitially used PRD account (in the above example). In this connection, you must also take Note213669 into account.

7. With the adjustment posting of EUR 9.77, the balance on the material stock account wasadjusted by the original rounding difference of EUR 9.77 (resulting from calculating the foreigncurrency amount during goods receipt).

Validity

This document is not restricted to a software component or software component version

References

This document refers to:

SAP Notes 

This document is referenced by:

SAP Notes (5) 

518114 FAQ: Goods movements in foreign currency 

388502 Document currency euro (EUR) / move logic 

375507 MB1B: Valuation with transfer posting of consignment stocks 

191927 Posting logic: GR for foreign currency PO 

145920 EWUMMPRS(_40): material price 0 after changeover  

145920 EWUMMPRS(_40): material price 0 after changeover  

191927 Posting logic: GR for foreign currency PO 

388502 Document currency euro (EUR) / move logic 

8/10/2019 96 - Valuation During GR for Foreign Currency Purchase Order

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375507 MB1B: Valuation with transfer posting of consignment stocks 

518114 FAQ: Goods movements in foreign currency