Why does exchange gain / loss show in Cash Basis Accounting for Receivables (Doc ID 1294984.1)

Last updated on SEPTEMBER 20, 2016

Applies to:

Oracle Receivables - Version: 12.1.1 and later   [Release: 12.0 and later ]
Information in this document applies to any platform.
Form:ARXSYSPA.FMB - Define System Options
EXECUTABLE:XLAACCPB - Create Accounting
EXECUTABLE:ARACCPB - Submit Accounting
EXECUTABLE: XLAACCUP - Accounting Program

Goal

Why does exchange gain / loss show in Cash Basis Accounting for Receivables? You do not believe gain loss entries should be created for cash basis accounting entries.


Create primary ledger using cash basis accounting then create cross currency transactions in Receivables application.

When there is an exchange rate difference between a foreign currency
transaction and its receipt, the system automatically creates
exchange gain / loss.

Testcase:
==========
1. Create invoice in entered currency EUR
2. Create receipt in functional currency HUF
3. Apply receipt to invoice
4. Run create accounting
5. Reviewed receipts diagnostics and XLA_AE_LINES shows EXCHANGE_GAIN_LOSS records. Also XLA_DISTRIBUTION_LINKS shows RCT_EXCH_GAIN_LOSS.

Solution

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