AR Payment Allocation: Incorrect Currency Balancing Postings

Description

The scenario results in incorrect Currency Balancing postings in USD schema and can be simulated as follows:

  1. AR Payment in period 1 in local schema currency e.g. THB 12000.
    Currency rate THB/USD 1/30.212666962751.

  2. Customer invoice in period 2 for partial amount of THB 10700.
    Currency rate THB/USD 1/29.905289946739.

  3. Perform manual partial allocation using window Payment Allocation for THB 10700.
    The allocation document posts as follows in USD:
    DR Unallocated Cash 357.80,
    CR AR 357.80 ,
    CR Unallocated Cash 3.65,
    DR Currency Balancing 3.65 (not ok).
    This is incorrect and 3.65 (or actually 3.64 according to our conversion) should go to Realized Loss instead of Currency Balancing. Currency Balancing should only be used for minor rounding variances (usually .01 or .02) to ensure total Unallocated Cash/Payment Selection/AR/AP/Inventory Clearing and NIR are zero after final 'clearing' OR to ensure total debit and credit in an accounting fact are zero.

 

Environment

None

Assignee

Heng Sin Low

Reporter

Elaine Tan

Labels

None

Tested By

Michael Powacht

Fix versions

Priority

Minor
Configure