Currency on the Project record
There are 3 currencies in FinOps:
- Transaction currency - In which transaction happens
- Accounting currency - In which the company accounts (configured in the Ledger under Accounting currency)
- Reporting currency - In which the company reports (configured in the Ledger under Reporting currency)
- Transaction Currency and Environment Currency is seen in the "Actuals" view
- Accounting Currency (from FinOps) is seen on the Project record for cost values
That means if the Accounting Currency is GBP and the if the cost on the project is posted in INR. Then in ProjOps the currency triangulation would happen as ProjOps does not have currency pairs like FinOps. In ProjOps every currency is pegged to the environment (Base) currency which is USD in this case.
- COST (Time, Expense and Procurement) - System would first convert the INR into USD and then convert the USD to GBP.
- UNBILLED SALE - Amount would be in GBP as that is the currency of the Project Contract.
- Transaction Currency - INR for Cost
- Accounting Currency - GBP
- Reporting Currency - USD (Assuming reporting currency is USD)
- Please refer to the first screenshot/image
above from ProjOps Actuals view. The fields highlighted in RED get their
values from ProjOps and fields highlighted in BLUE get their values from
FinOps.
- The FinOps related fields "Accounting
Amount" and "Accounting Amount (Base)" are not calculated
correctly and we suspect this to be a Microsoft bug. However, PM residing
in ProjOps can still look at the ProjOps related fields .i.e. "Amount"
and "Amount (Base Currency)".
- The "Exchange rate" field is
displaying the exchange rate from ProjOps and "Account Exchange
Rate" is displaying the exchange rate from FinOps.
- Accounting Currency values will reside in
FinOps. FinOps will display values in three currencies - Transaction
Currency, Accounting Currency and Reporting Currency and all three can be
different.
- However, ProjOps will display the
"Amount" in Transaction Currency and "Amount(Base
Currency)" in environment/ base currency, which in our case seems to
be USD.
- To make things work correctly from currency
perspective – Exchange rates needs to be maintained correctly in both
ProjOps and FinOps as they do NOT automatically sync as of now. Please
refer to the second image below where I have explained the concept pictorially
about the two currency tables in the ProjOps system.
- There are two currency tables in ProjOps:
- Currency Table
- Currency Exchange Rate Table
- Currency table
- Currency Exchange Rate table
- Please note that the "Actual Cost" fields shown in the screenshot above from ProjOps will NOT equal to the value in the FinOps as the "Actual Cost" field in ProjOps displays the TOTAL value based on the latest exchange rate in ProjOps. On this COST field in the Project record, system logic changes the entire amount to the latest exchange rate. In FinOps, the total considers the historical value of the cost based on the historical exchange rate. However, this is not the case in the "Actuals" view as seen in the screenshot above of the "Actuals" view.
- The issue with Microsoft when it comes to the display in the "Actuals" view, for the "Amount" fields without "BASE" in its name, system displays all in the "Currency" of that Actuals line. This is a limitation of ProjOps. The "Amount" is in IDR but the "Accounting Amount" is actually in USD as USD in the Accounting currency in this example. But because of the system limitation the "Accounting amount" value also is shown with IDR currency symbol.
- For "Amount" fields with "BASE" in their name, system displays the amount in the environment currency which is USD in this case. Hence it is recommended not to look at "Accounting amount" and "Accounting amount (Base)" as it is confusing for the user in ProjOps.
- Suppose if the Environment currency of ProjOps is EUR, then "Amount(Base Currency)" will be shown in EUR in ProjOps in the Actuals view.
- Accounting Currency setup in the Ledger section in GL in FinOps is GBP, which means the "Cost" fields on the Project record in ProjOps would be shown in GBP
- Reporting Currency in FinOps can be USD, setup in the Ledger section in GL in FinOps
- Transaction Currency can be any in ProjOps, but for example, it is INR
- Project Contract Currency in ProjOps can be any, but for example it is SGD
- With this setup, when the transaction is posted in ProjOps, it will be in transaction Currency - INR
- Cost would be posted in INR, Unbilled sale would be posted in SGD
- The data seen on the Project record would be in GBP as the accounting currency is GBP. The currency translation would happen from INR to EUR and EUR to GBP, as the environment currency is EUR and currency exchange rate is pegged against EUR. (Triangulation)
- The data seen on the Actuals view would be:
- COST - Amount would be in INR and Amount (Base Currency) would be in EUR
- UNBILLED SALE - Amount would be in SGD and Amount (Base Currency) would be in EUR
- Reporting currency would be USD in FinOps