Revaluation of Bank Accounts: Process Activity

The following activity will walk you through the process of performing the revaluation of a bank account.

Story

Suppose that the accounting department of SweetLife Fruits & Jams company has to revalue the company's bank account in CAD several times within each financial period. Acting as a SweetLife accountant, on January 24, 2024, you need to revalue the cash account for the 01-2024 financial period and post the generated GL transactions.

Configuration Overview

In the U100 dataset, the following tasks have been performed for the purposes of this activity:

  • On the Enable/Disable Features (CS100000) form, the following features have been enabled:
    • Standard Financials, which provides the standard financial functionality
    • Multibranch Support, which supports multiple branches in your instance of MYOB Acumatica
    • Multicompany Support, which supports multiple companies within one tenant.
    • Multicurrency Accounting, which enables multicurrency operations in the system
  • On the Companies (CS101500) form, the SWEETLIFE company has been defined.
  • On the Branches (CS102000) form, the HEADOFFICE branch of the SWEETLIFE company has been created.
  • On the Chart of Accounts (GL202500) form, the 84010 (Cash Account Revaluation Gain/Loss CAD) account has been created.

Process Overview

In this activity, you will review the revaluation rate type specified for the 10215 account on the Chart of Accounts (GL202500) form. On the Account Summary (GL401000) form, you will review the balance of the account, which is denominated in CAD, before its revaluation. (You created this GL account and the corresponding cash account in Multicurrency Cash Accounts: To Configure an Account.) On the Revalue GL Accounts (CM506000) form, you will revalue the denominated account and review the GL transaction generated by the system on the Journal Transactions (GL301000) form. Finally, you will review the updated balance of the denominated account on the Account Summary form.

System Preparation

Before you begin performing the steps of this activity, do the following:

  1. Launch the MYOB Acumatica website with the U100 dataset preloaded, and sign in as an accountant Anna Johnson by using the johnson username and the 123 password.
  2. On the Company and Branch Selection menu on the top pane of the MYOB Acumatica screen, make sure that the SweetLife Head Office and Wholesale Center branch is selected. If it is not selected, click the Company and Branch Selection menu button to view the list of branches that you have access to, and then click SweetLife Head Office and Wholesale Center.
  3. As a prerequisite activity, make sure that the multicurrency accounting functionality has been configured as described in Multicurrency Functionality: Implementation Activity and Configuration of Rate Types and Rates: To Configure Rates.
  4. As a prerequisite activity, make sure that you have configured an account as described in Multicurrency Cash Accounts: To Configure an Account.
  5. As a prerequisite activity, make sure that you have processed a funds transfer as described in Multicurrency Funds Transfers: Process Activity.

Step 1: Reviewing the Revaluation Rate Type

To review the revaluation rate type for the account denominated in CAD, do the following:

  1. Open the Chart of Accounts (GL202500) form.
  2. In the Revaluation Rate Type column, review the revaluation rate type in the row with the 10215 account.

    The revaluation rate type should be SPOT.

    Note:
    If the revaluation rate type is not specified for a particular account, for the revaluation of this account, the system uses the default rate specified in the GL Revaluation Rate Type box of the Currency Management Preferences (CM101000) form.

Step 2: Reviewing the Balance of the Denominated Account Before Revaluation

To review the balance of the 10215 account, which is denominated in CAD, do the following:

  1. Open the Account Summary (GL401000) form.
  2. In the Selection area, specify the following settings:
    • Company/Branch: HEADOFFICE - SweetLife Head Office and Wholesale Center (inserted automatically)
    • Ledger: ACTUAL
    • Period: 01-2024
    • Show Currency Details: Selected
  3. Review the balance of 10215 (Checking Account CAD). (Notice that the Currency ID column contains CAD for this account.)

Step 3: Revaluing the Bank Account

To revalue the bank account denominated in CAD, do the following:

  1. Open the Revalue GL Accounts (CM506000) form.
  2. In the Selection area, specify the following settings:
    • Company/Branch: HEADOFFICE - SweetLife Head Office and Wholesale Center (inserted automatically)
    • Fin. Period: 01-2024
    • Currency Effective Date: 1/24/2024
    • Currency: CAD
    • Description: GL Revaluation 01-2024 CAD
  3. Select the unlabeled check box in the only row in the table, and on the form toolbar, click Revalue to perform the revaluation for the selected account. The system generates a revaluation transaction and opens it on the Journal Transactions (GL301000) form.
  4. On this form, review the revaluation transaction in the base currency. Notice that the Auto Reversing check box in the Summary area is cleared; the created batch is not auto-reversing and thus will not be reversed at the start of the next period.

    When the revaluation transaction was automatically posted, the following actions were performed in the system:

    • The revalued 10215 checking account was debited in the amount of the calculated revaluation gain ($0.63).
    • The revaluation gain/loss account specified for the CAD currency (84010), which you specified when you defined the CAD currency in Multicurrency Functionality: Implementation Activity) was credited in the amount of the calculated revaluation gain ($0.63).

Step 4: Reviewing the Balance of the Denominated Account After the Revaluation

To review the balance of the 10215 account denominated in CAD, do the following:

  1. Open the Account Summary (GL401000) form.
  2. In the Selection area, specify the following settings:
    • Company/Branch: HEADOFFICE - SweetLife Head Office and Wholesale Center (inserted automatically)
    • Ledger: ACTUAL
    • Period: 01-2024
    • Show Currency Details: Selected
  3. Review the table. The balance of the denominated 10215 checking account is now updated. It was revalued by the system by using the CAD exchange rate effective on 1/24/2024.
  4. Click the row with the 84010 (Cash Account Revaluation Gain/Loss CAD) account, and on the form toolbar, click Account Details.
  5. Review the Account Details (GL404000) form, which opens. The revaluation gain amount has been credited to the 84010 account.