Currency Setup

Currency setup is one of the first and most important steps in Microsoft Dynamics 365 for Finance and Operations is currency setup.  Currency setup is a mandatory step in the configuration of the system and is used to record financial transactions.  All companies will have a base reporting currency, and in some companies that will be the only currency needed.  Multicurrency functionality may be used if your company does business in more than one currency.  If your organization has multiple legal entities and transacts in multiple currencies, then maintaining currencies and their corresponding exchange rates is essential.

There are several things with regard to currencies that need to be set up.

1. We need to determine which currencies we will be transacting in 
2. We need to specify our exchange rate types which then allow us to set up our currency exchange rates
3. Once we have determined our currencies, we can then define currency exchange rates between two currencies, or a currency pair.
4. With our currencies set up, we then must designate the default main accounts that will be used during the currency revaluation process. These will determine our gains and losses on such things as foreign currency denominated assets and liabilities the entity may have, such as payables, receivables and long term debt.

Add Edit Currency

• Add New
• Enter Currency code, Name, Symbol.
• Then Save

Field	Description
Currency	The unique identifier for the selected currency. This code can contain up to three characters. Examples ·         USD – U.S. dollar ·         EUR – Euro ·         CAD – Canadian dollar
Name	The name of the selected currency. This name, together with the currency code, is printed on checks and other documents. Examples ·         U.S. dollar ·         Euro ·         Canadian dollar
Symbol	The symbol of the selected currency. Symbols are frequently used on reports. Examples ·         € – Euro ·         $ – U.S. dollar
Currency code	The standard code of the currency as defined by the International Organization for Standardization (ISO).
Reference currency for triangulation	The currency that other currencies, which are defined as denomination currencies, are triangulated through.
Conversion	Select this check box to include the selected currency in the calculations of the online numeric conversion tool. The tool automatically converts amounts that are entered on transaction lines in the accounting currency to amounts in the selected currency.  Note The converted amounts in the selected currency are not saved in the database.
Prefix	Enter the text that is printed in front of the amount in the selected currency if the Conversion check box is selected.
Suffix	Enter the text that is printed after the amount in the selected currency if the Conversion check box is selected.
General rounding rule	Enter the unit for rounding amounts. For example, you might enter 0.10 or 1.00.
Rounding rule	Enter the unit for rounding amounts on sales orders, purchase orders, or prices.
Rounding method	Select the rounding convention that applies to the number to the right of the round-off unit that is entered in the Rounding rule field. ·         Normal – Round up numbers 5 and higher and round down numbers that are less than 5. ·         Downward – Round down all numbers. ·         Rounding-up – Round up all numbers.
Gender	Select Feminine if the selected currency has a feminine gender and the gender is used on checks and reports. The default value for this field is Masculine, which, in effect, means no gender.

Exchange rate type

Sometimes businesses work with different exchange rates e.g. for budgeting vs. daily transactions. You can create additional exchange rate types if those inside the system are not enough for your business needs.

We need to specify our exchange rate types which then allow us to set up our currency exchange rates.  Once we have determined our currencies, we can then define currency exchange rates between two currencies or a currency pair.  

For every exchange rate type, you can define exchange rates. You can go to the exchange rates from within exchange rate type form.

Exchange rates

First you select the exchange rate type, then  create or select the exchange rate pair depending on if it already exists or not. Finally, add the exchange rate for a specific date range.

The exchange rates can be updated manually or they can be imported by configuring an exchange rate provider. You can select from 3 standard providers, other than that an integration to the provider must be  developed.

Configure Currency exchange rate providers

Microsoft Dynamics 365 For Finance and Operations provides integration with 3 exchange rate providers out of the box.

1. Central Bank of Russian Federation
2. Central Bank of Europe
3. OANDA

Depending on the country of your operations or your preference, you can use any of these providers to import currency exchange rates directly into Dynamics 365. Usually, OANDA is the widely used and most trusted exchange rate provider.

The configuration of these is pretty simple and straightforward. The integration with Central bank of Russian Federation and Central bank of Europe does not require you to setup an API key within Dynamics 365, where as for OANDA, you will need to get the API key from OANDA and set it up in Dynamics 365. OANDA also lets you do more flexible setups, such as how many decimal places you want to use, what quote type you want to use.

Thanks to : 

d365hub

sandeepchaudhury