In IMG, we maintain currency configuration for local currency as well as parallel currencies. We can manage maximum three currencies in a company code with parallel currencies e.g., ‘Company Code currency’, ‘Group currency’, and ‘Hard currency’. Parallel currencies are the custom currencies as per the requirement of the company. Parallel currencies can work in foreign business transactions. If we want to do international payments or receivables transactions, we must configure parallel currency.

Generally, custom currency is used by the company having subsidiaries in different countries. Custom currency can influence in area like General ledger, Account Receivables and Payables, Asset accounting, Sales Area, Material management area, Controlling part etc. For reporting, we can define custom currency in those areas.

At the time of transaction, we can do the entry in base / local currency; after that, we can see the reports in custom currency. Values posted in those transactions can be updated in custom currencies too. The custom currencies are not posted directly but get posted during periodic posting.

Custom currency can maintained in “Define Additional Currency”, Local currency is being maintained for the local transactions and legal financial reporting.  OB22

Navigation Path:

IMG > Financial Accounting (New) > Financial Accounting Global Settings (New) > Ledgers > Ledger > Define Currencies of Leading Ledger

local currency

additional local currency

Through this transaction code, we can operate functions like maintain, change and delete the additional currency and related information. Parallel currencies are usually used in a scenario where numerous legal entities spread in various countries belong to the same client. For the individual legal entities, the 1st local currency will be the country specific currency, the 2nd local currency would be the group currency and 3rd local currency would be hard currency. This configuration ensures that we have a consolidated reporting based on the group currency.

For further information, refer my blog on  Currency Exchange Rate .
Please send us your questions, comments or assistance, and our team would be glad to assist you.

By Sareeka Bangar (on behalf of SAP Consulting Team)


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