Introduction - Process payments and cash receipts in multiple currencies
Using the cash receipt journal and the payments journal for transactions with multiple currencies is basically the same as using these journals with a single local currency.
The primary difference is posting restrictions based on currency. The ability to post a journal is determined by the relationship between the Currency Code that is assigned to the selected bank account and the Currency Code on the journal lines. For the payment journal, these restrictions also affect the ability to print checks and are determined by the Currency Code that is assigned to the selected bank account and the contents of the Bank Payment Type field.
Posting restrictions
The rules for posting cash receipt activity by using multiple currencies are summarized in the following table.
| Bank Account Currency Code | Printing and Posting Rules |
|---|---|
| Blank (LCY) | Post receipt lines with any currency code, including LCY. |
| Currency Code | Post only those receipt lines with the same currency code as the bank account. |
With multiple currencies, you can use the same cash receipt journal when the Bank Account Currency Code is LCY. However, you can also take advantage of the following situations:
Payments that are made in one currency can close invoice entries in a different currency. For example, payment that is received in Euros can be applied to an invoice in Danish Krone.
Payments in one currency can be applied to multiple invoice entries with more than one currency. For example, a payment in Euros can be applied to two invoices, one in Danish Krone and one in Euro.
Before you can apply entries with a different currency code, perform the following setup on the Sales & Receivables Setup page:
Select the Search for Page icon in the top-right corner of the page, enter sales & receivables setup, and then select the related link.
In the Appln. between Currencies field, choose one of the following options:
None - Application between currencies isn't allowed.
EMU - Application between EMU currencies is allowed.
All - Application between all currencies is allowed.
Likewise, if you purchase from a vendor in one currency and submit payment in another currency, you can apply the payment to the purchase when the Appln. between Currencies field on the Purchases & Payables Setup page is set up accordingly.
The rules for printing checks and posting payment activity by using multiple currencies are summarized in the following table.
| Bank Account Currency Code | Bank Payment Type Field Contents | Printing and Posting Rules |
|---|---|---|
| Blank (LCY) | Computer Check or Manual Check | Print only those checks for LCY payment lines. Post only LCY payment lines. |
| Blank (LCY) | Blank | Post payment lines with any currency code, including LCY. |
| Currency Code | Computer Check or Manual Check | Print only those checks with payment lines where the currency code is the same as the bank account. Post only those payment lines with the same currency code as the bank account. |
| Currency Code | Blank | Post only those payment lines with the same currency code as the bank account. |
Watch this video which demonstrates processing a payment in a foreign currency.