Openbravo Issue Tracking System - Openbravo ERP
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IDProjectCategoryView StatusDate SubmittedLast Update
0023116Openbravo ERP09. Financial managementpublic2013-02-19 15:472013-04-26 08:54
Reporterpjuvara 
Assigned Todmiguelez 
PrioritynormalSeveritymajorReproducibilityalways
StatusnewResolutionopen 
PlatformOS5OS Version
Product Version3.0MP19.1 
Target VersionFixed in Version 
Merge Request Status
Review Assigned To
OBNetwork customer
Web browser
ModulesCore
Support ticket
Regression level
Regression date
Regression introduced in release
Regression introduced by commit
Triggers an Emergency PackNo
Summary0023116: Incorrect handling of currency gain/loss results in invalid balance sheet
DescriptionConsider the following situation

1) You have a ledger with a base currency, let's say USD
2) You have two financial accounts, A and B, in a foreign currency, let's say EUR
3) The exchange rate from 01-Jan-2013 to 31-Jan-2013 is 1 EUR = 1.30 USD
4) On Jan-31, account A has a balance of 100 EUR; that appears on the balance sheet as 130 USD
5) The exchange rate changes on Feb 1 and it goes to 1 EUR = 1.35 USD
6) On Feb-2, you transfer 100 EUR from account A to account B; the operating balance of account A goes to 0 and you expect it to appear as 0 on the balance sheet.

However, the effect of transferring money from account A to account B, which is done as creating a G/L Item transaction to a transfer account is to create the following accounting entry:

Bank Account A:(Cr) 100 EUR (135 USD)
EUR Fund Transfer: (Dr) 100 EUR (135 USD)

The accounting entry is balanced both in base currency and foreign currency. The operating value of the account is correctly reported as 0 EUR.

However in the balance sheet it appears as -5 USD, which is incorrect.
Steps To ReproduceSee above.
Proposed Solution
Additional Information
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Issue History
Date ModifiedUsernameFieldChange
2013-02-19 15:47pjuvaraNew Issue
2013-02-19 15:47pjuvaraAssigned To => dmiguelez
2013-02-19 15:47pjuvaraModules => Core
2013-02-19 15:47pjuvaraTriggers an Emergency Pack => No
2013-02-19 15:52pjuvaraNote Added: 0056551
2013-04-26 08:54dmiguelezTypedefect => feature request

Notes
(0056551)
pjuvara   
2013-02-19 15:52   
I am not entirely sure how this bug should be resolved.

My guess is that the correct action would be to revalue all financial accounts denominated in a foreign currency when the exchange rate changes.

That way on Feb 1st, when the new exchange rate becomes effective, you have the following accounting entry:

Bank Account A: (Dr) 5 USD
Foreign Currency Bank Revaluation: (Cr) 5 USD

With that accounting entry, when you then transfer funds out of the account, the balance sheet remains accurate.