Billing Extensions and Multiple Currencies

Billing and cost rates for project reporting are defined at the time of posting. When you post a transaction, Vision looks at the applicable billing terms to determine billing rates for project reporting purposes. If you later update the billing terms, your updates are not reflected on the project reports unless you refresh billing extensions.

If you are using the Multicurrency feature, Vision performs either one calculation or two calculations for billing extensions, depending on your Accounting System Settings.

• Vision always calculates billing extensions in the billing currency.

• If you select the Use billing currency not project currency option on the Reporting tab of Configuration > Accounting > System Settings, Vision calculates an extra extension after the fact to convert the amount back to the project currency.

Therefore, if you have a transaction on a posting log for which the functional currency is the same as the project currency, but the billing currency is different, you need to be aware that there is actually an extra exchange being done to calculate the billing extension.

Example

Project A belongs to Company-US:

• Functional Currency: USD

• Project Currency: BHD

• Billing Currency: EUR

Daily exchange rates:

• USD -> EUR 1.5 exchange rate

• USD -> BHD 4.5 exchange rate

• EUR -> BHD 3.0 exchange rate

The Billing Terms multiplier for the transaction is 2.0.

When calculating the billing extension for a functional amount of $100.00 (USD), Vision performs these steps:

1. 100 USD * 1.5 = 150 EUR (functional currency amount to billing currency amount)

2. 150 EUR * 2.0 multiplier from billing terms = 300 EUR (extension of billing currency amount)

   Result = 300 EUR

   If you select the Use billing currency not project currency option on the Reporting tab of Configuration > Accounting > System Settings, Vision calculates an extra extension after the fact to convert the amount back to the project currency. So Vision adds a third step, and the result is quite different:

3. 300 EUR * 3.0 = 900 BHD (billing currency amount to project currency)

    Final result:  900 BHD