In today’s modern world with the globalization, it is quite common for any organization to have business spread across different countries. In this case, to run their business, organization will end up taking leases in the country in which they are operating and these lease payments need to be done in a foreign currency.

To meet this growing requirement of organization, Oracle Property manager enhanced to handle the foreign currency leases.  In property manager a billing / payment term can be entered in any other currency than the functional currency of the ledger.

When a payment term is created with foreign currency, billing / payment amounts are converted into functional currency based on

  • Conversion rate type specified in the Currency Conversion Type system option.

  • Conversion Type specified in Reporting Currencies window for the functional currency. This will be used only if the Conversion rate type is not specified in system option

  • Entering the conversion rate manually in Payment terms window. This can be entered only if the Conversion rate type is set to ‘user’ in System Option.

Currently in property manager, the exchange rate can be derived in two different ways

User Defined Exchange Rate – In system options you need to select the currency conversion type as user and in this case system will allow user to enter the required exchange rate at lease level itself and all future transactions for the lease will be converted based on this user defined exchange rate.

Automatic derivation of Exchange Rate from GL – In System options, if the currency conversion type is set to “Corporate” or any other conversion type, system will automatically derive the exchange rate based on the conversion type.

For converting the foreign currency to functional currency, system uses the transaction and system date to determine the rate.

Exchange rate

If you are using the oracle property manager & Equipment lease solution to meet your IFRS & USGAAP reporting requirements for lease accounting, then the exchange rate for foreign currency leases will be derived based on below logic

table

For more information on the foreign currency leases, please refer the Property Manager User Guide