Cross Rate - Settlement without Exchange Adjustment impact - AX 2009

Settlement of open transactions is an important task within the AX system. When there is only a single currency involved, it is a fairly simple task to settle one transaction against the other. But when there are multiple currencies involved, there is more to the settlement functionality than a straightforward "knock-off".

When a transaction is posted in the system, it is posted on the exchange rate defined on the currency master, unless over-ridden while posting. It is common that the transactions to be settled have been posted with different exchange rates, depending on the amount of exchange volatility the business allows. 

While settling, again, the exchange rate can be different. This leads to exchange rate gains/losses and adjustments to be posted in the Ledgers.

There are many cases wherein it is desired to settle open transactions at a particular rate as against the system defined rates. It may be to reduce exchange losses or to honor an agreement.

Cross Rate functionality in AX allows to do just that. One can use a cross rate to settle open transactions, and the lines are in a currency different from that of the reporting/default currency. One of the lines to be settled is marked as a primary payment and the cross rate is specified. This rate is then used to settle the selected transactions.

Note: This is applicable to both Payable and Receivables.

The process:

Go to Open transactions Editing form

Select the transactions to settle

Select the payment line and click on Mark Payment button

The cross rate field becomes editable on the marked line and the transaction gets marked as primary payment.

In the Cross Rate field, enter the exchange rate at which the transactions should be settled.

Update the transactions.

The transactions will now be settled at the rate specified on the line. There will be no exchange rate differences posted to the ledgers and the settlement is posted at the specified rate.

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