Business Solution for Multi-Currency Company
Global businesses are accustomed to managing different currencies, but this can be a primary source of pain without the correct ERP solution in place. Acumatica, the Cloud ERP, has always supported international businesses with multi-currency transaction capabilities, but thanks to recent updates, it can now support multiple base currencies within a single tenant.
Our team at AcuPower understands the unique needs of international companies with multiple base currency requirements. In this blog, we will highlight how Acumatica makes managing your global financials easier and more efficient.
Multiple Base Currencies
Previously, if an organisation wanted to implement related companies with different base currencies into their Acumatica instance, they would have needed to spin up a separate tenant for each. Although this workaround was doable, it was inefficient and made certain areas difficult to maintain, such as approvals, joint projects, and shared lists of items, among others. Since user experience is of utmost importance, Acumatica knew a change was needed.
As of 2021, international companies can now implement multiple companies with different base currencies within a single tenant. With this functionality, your organisation can simplify centralised approvals, shared vendors and customers, automation between related parent/child accounts, and shared inventory items with in-currency pricing and standard costs.
Using time and expense (T&E) approvals as an example, if the approver was located in the UK parent company, but was also responsible for their US companies, the approver would have to log into a different tenant to complete the approval process. Thanks to the recent improvements, the approver can remain in their US tenant and have the T&E approval transmit into their workflow. With these streamlined workflows, your team can spend less time on manual tasks and more time on analysis and revenue-generating activities!
Does your organisation perform intercompany transactions? If so, you know that intercompany transactions should be executed in a timely and accurate manner so they can be easily tracked, reconciled, and eliminated when it comes time for consolidated financial reports. Unfortunately, most ERP systems don’t provide an easy way to manage global intercompany transactions. With a lack of integration, organizations must rely heavily on spreadsheet-based reports that are manually generated and error-prone.
With Acumatica’s enhanced intercompany transaction capabilities, our team at AcuPower can configure how you want the system to handle the balancing entries of entities with different base currencies. For instance, a child company in France creates an AP bill (Due To), and it will be paid for by the UK parent company (Due From). When the parent company is ready to pay the bill, the user can select the appropriate currency, insert the amount, and release payment. This allows your organisation to track, record, and reconcile transactions between your parent company and related companies with differing base currencies. It eliminates manual data entry, saving time and reducing errors.
Without the right ERP, it can be very difficult for an accounting team to generate accurate consolidated financial reports. With multiple base currency functionality, and Acumatica’s strong financial reporting tool (Analytical Report Manager), you can create and view consolidated financial reports that provide real-time data, empowering you to easily analyse how the related child accounts impact the parent company. Users can drill down into the details of the transactions, allowing them to extract deeper insights into the data within seconds instead of needing to find and sort through several spreadsheets and disconnected accounting systems.
With Acumatica’s ability to support multiple base currencies, you receive an accurate and simplified view of your business.
Acumatica can support as many currencies as you need, and exchange rates can be updated as frequently as you choose. You can input all of the currencies you transact with on the currencies screen and later assign the applicable currency rates as preferences on your customer and vendor records.
Out-of-the-box the rates are set up for “Spot Exchange Rate” which is the current market rate for exchanging one currency for the other. You can also set the currency rates to be automatically refreshed through the Open Exchange Rates API. Acumatica can automatically compute realised and unrealised currency gains and losses and perform account revaluations, minimising your company’s financial risk when currency values change dramatically.
When transactions do occur between internal or external companies, based on the structure and base currency established, Acumatica will recognise what the currency is and impose the correct exchange rate. Once completed, these details will automatically flow into your financial statements.
Take the Next Step
Managing global financials is no easy task, especially when you have multiple companies with different base currencies. Our team at AcuPower can help you overcome these challenges with a modern ERP built for global companies. Take a glimpse of the Acumatica financial module to see what other needs in financial management get covered. If you would like to discuss your needs and goals for your business with our team, please contact us to schedule a no-obligation custom demonstration.