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MRC is specifically intended for use by organizations that must regularly and routinely report their financial results in multiple currencies. MRC is not intended as a replacement for General Ledger's Translation feature. For example, an organization with a once-a-year need to translate their financial statements to their parent company's currency for consolidation purposes, but no other foreign currency reporting needs, should use General Ledger's standard translation feature instead of MRC.

Another benefit of MRC over General Ledger's Translation feature is that with MRC you can inquire and report on transaction amounts in your reporting currencies directly from your subledgers. Translation only applies to General Ledger -- it cannot be used to translate transaction amounts in your subledgers.

If you use MRC and have properly initialized your reporting set of book's balances (see: Initializing Account Balances in Your Reporting Sets of Books), you can report directly from your reporting sets of books without running Translation. This is because the actual transaction amounts in your reporting sets of books have already been converted from your primary set of book's functional currency. As a result, the account balances of your reporting set of books are automatically maintained in your reporting currency.

For example, to consolidate a subsidiary that maintains a reporting set of books using your parent company's functional currency, you might simply consolidate the reporting set of books to your parent set of books, rather than translating, then consolidating the subsidiary's primary set of books.

Usually, when you compare the results of using amounts from your reporting set of books rather than translated primary set of book's amounts, there will be rounding differences in your accounts. Many of these differences arise because a reporting set of book's transaction amounts are converted using daily rates. Translation, however, uses period or historical rates to translate account balances.

Before you use your reporting set of book's amounts in lieu of translating your primary set of book's amounts, you need to understand and carefully consider:

• How MRC works.

• The country-specific accounting rules and regulations that govern your parent and subsidiary companies.

Note About Budget Balances

For example, after translating budget amounts to your reporting currency, you can use FSG to create a budget variance report with three columns:

• Translated budget amounts. Your FSG column set can draw these amounts directly from your primary set of books.

• Reporting currency actual amounts. Your FSG column set can draw these amounts from your reporting set of books.

• The variance between budget and actual, expressed in your reporting currency.

See Also

Performing Multi-Company Accounting

Type of Installation

MRC Starting Dates

Initializing Account Balances in Reporting Sets of Books