SAP in turn should be able to handle this transaction with different currencies through the exchange rate functionality. In this scenario the two currencies are: EUR and USD. If a company is based in Europe and purchases from a foreign vendor based in United States, you would expect 2 (two) different currencies involved in the financial transaction. Realistically, a company may have transactions in different currencies. During financial closing or month end / period end close, we need to perform Foreign Currency Valuation.
In a nutshell, Exchange Rates are maintained in SAP and are utilized in daily tasks through the usual financial postings and maintenance of these rates.
What is the difference between exchange rate and foreign currency valuation in SAP?
