Converting Currencies

Objectives
After completing this lesson, you will be able to:

After completing this lesson, you will be able to:

  • Convert currencies using the model and story currency conversion measures

Currency Translation Overview

SAC analytic models can easily handle most currency scenarios without a separate currency dimension by using the model and story currency conversion measures.

Note

New Models users can enable a currency variable in the model preferences to set a default target currency for conversions measures.

Note
Currency tables can be updated via:
  • Flat files
  • BPC rate models
  • BW Queries

SAC Currency Translation - Key Points

  • Exchange rates are stored in the SAC currency translation table.
  • Exchange rates originate from financial institutions and are automatically or manually updated into SAC.
  • Currency use case examples include:
    • Display corporate (group) and local operating currencies in stories.
    • Import and Plan in local currency and immediately translate to group currency.
    • Translate with category-specific exchange rates.
    • Import both local and group currency actual values.
    • Analyze trends in constant currency.
Note

The term Local Currency (LC) refers to the functional or operating currency of a company, for example. A company in the US has an LC of USD, and so on.

The term Group Currency refers to the corporate level currency. A company in the US that has a German parent therefore has a group currency of EUR, for example.

The term Translation is being used interchangeably with conversion.

The concepts in this lesson concern planning concepts only, not month-end closing currency translation.

Note

Displaying the local currency (property) in the columns is optional.

In the figure entitled Currency Translation Results in a Story, the new model is demonstrated. You can access the example above in the U00S_Currency story in the SACP20 → Solutions folder.

Note

The Booking Date, for example, is determined through the date dimension (specified in the currency setting) in the model.

If a currency conversion is added and there are no exchange rates, the system will direct you to the currency table (to add the missing rates).

Currency Translation Table

Currency conversion tables are defined independently of models. You can apply a selected table to any model you create. Currency tables are listed on a separate Currency Conversion page, where you can add, copy, and delete currency tables as required.

Currency Conversion Tables https://help.sap.com/viewer/00f68c2e08b941f081002fd3691d86a7/release/en-US/9348d55977e94994ab27bf031389d8f2.html

Model and Dimension Currency Settings

If the currency variable is turned on, the variable can be used to determine the target currency for a translated measure (but not in a measure).

  • One of the main use cases involves SAC models designed for SAP ERP financial data. In this case the following measures would be used:
    • Local currency amount
    • Group currency amount
    • Others if needed
    • Quantity
  • Measures can also be added to the model that calculate currency values on-the-fly.

Switch on Enable Currency to add a Currency column to the dimension. Using three-character currency codes, this column identifies the source currency for data that belongs to each leaf member. The Currency column is enabled by default for the Organization dimension, and can also be added to generic dimensions.

For each converted measure in the model, a dimension (any dimension with currency enabled) is set as the currency dimension.

In the account dimension, the Rate Type attribute column appears when you switch on Currency Conversion in the model preferences. With currency conversion switched on, set the Rate Type to Average for INC and EXP accounts, and to Closing for AST and LEQ accounts. This setting corresponds to the rate type for exchange rates in your currency table. It lets you distinguish between the average exchange rate over a period and the closing rate at the end of the period.

Only the average and closing rate types are possible. Custom rate types are not possible.

Currency Conversion Examples

Note
The CAD value for Store 1 in the preceding image, is 5,000,000:
  • 5,000,000 CAD x .15 = 750,000 MXN
  • 5,000,000 CAD x .154 = 750,000 MXN

If needed, you can compare values that use exchange rates for different categories. This is useful for what-if scenarios.

Constant currency scenario: I want to see companies annual growth in a model currency (such as USD) but I want a flat conversion rate applied so I filter out the currency conversion impact on my figures.

In the preceding figure:

  • The Default Currency (USD) values are translated with the monthly average exchange rates for 2020. For example:
    • Jan: 11,655.9 x 1.1 = 12,821.5
    • Feb: 17,302.5 x 1.15 = 19,897.9
  • The USD in Constant ER (USD) values are translated with the Jan average exchange rate for 2020. For example:
    • Jan: 11,655.9 x 1.1 = 12,821.5
    • Feb: 17302.5 x 1.1 = 19,032.7

Configure and Translate Currencies

You need to convert currency values in your story. You have amounts in your model from different countries. For example, US company values are in USD, and Canadian company values are in CAD. These values by company/country are known as local currency values.

The corporate (group) currency values have also been imported into the model (imported directly from the source system). In addition, you want to create converted measures in the model so that you can save time when creating stories. There is also a story-specific need to compare current values at current exchange rates vs. prior year exchange rates to isolate variances due strictly to currency fluctuation.

In this exercise, you will perform the following tasks:

  • View the currency table
  • Copy a model with data
  • Confirm the model settings for currency translation:
    • Currency is enabled for the model with the P00T_SACMS01 currency table
    • The entity dimension members each have their own currency
    • The accounts are configured with average exchange rate types and the currency unit of measure
    • The local currency measure is based on entity dimension's currency property
    • The group currency measure is based on a fixed currency of USD
  • Add a new converted measure in the model for CAD
  • Create a table in a new story:
    • Display the local currency for each entity in the rows
    • Include the local, group, and CAD currency measures in the columns
  • Add a new currency measure in the story to translate local amounts using the prior year's exchange rate for USD

Prerequisites

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