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Dual-Base System

This page outlines the steps needed to set up a dual-base currency conversion system in Standard ERP.

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The Dual-Base system will be useful for companies that have offices in two countries and that need to report in both Currencies and for companies operating in countries where there is a second Currency (usually the US Dollar or Euro) in common use in addition to the national one. Users residing in a country that is going through the process of joining the Euro system should also use the Dual-Base system. To set up such a system, follow the steps numbered below:

  1. Enter the Currencies used in your business using the Currency register in the System module.

  2. Using the Base Currency setting in the System module, specify the two Currencies that are to be treated as the two Base Currencies, and specify the Currency that is to be the Default Base Currency. The Default Base Currency is the Currency that will be offered as a default in all transactions.

    Companies in the Euro zone retaining their old Currency for comparison purposes should have the Euro as Base Currency 1 and the Default Base Currency and the old national Currency as Base Currency 2.

    Companies operating in countries where there is a second Currency (usually the US Dollar or Euro) in common use in addition to the national one should have their home Currency as Base Currency 1 and the Default Base Currency and their second Currency as Base Currency 2.

    Companies in countries that is going through the process of joining the Euro should have their national Currency as Base Currency 1 and the Default Base Currency and the Euro as Base Currency 2.

  3. Enter conversion rates between the two Base Currencies using the Base Currency Rates setting in the System module.

  4. Enter conversion rates between your Base Currencies and the foreign Currencies using the Exchange Rate register in the System module.

    Companies operating in countries where there is a second Currency in common use will usually need Exchange Rates between foreign Currencies and Base Currency 1. However, they can also relate foreign Currencies to Base Currency 2 if necessary. This includes users in the Euro zone retaining their old Currency for comparison purposes.

    Users in countries that are going through the process of joining the Euro should only enter Exchange Rates between foreign Currencies and the Euro (Base Currency 2). Do not enter Exchange Rates between the home Currency and foreign Currencies, or between the home Currency and the Euro.

  5. Using the 'Exchange Rate' card of the Account Usage S/L setting in the Sales Ledger, specify the Accounts that are to be used for gains and losses resulting from Currency conversions in Sales Ledger transactions. You should also specify Rate Round Off and Bank Fee Accounts on this card.

  6. Repeat step 5 for Purchase Ledger transactions using the 'Rate' card of the Account Usage P/L setting.
Please follow the links in each step for detailed descriptions.

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Currency conversion in Standard ERP:

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