Microsoft Dynamics CRM 4.0 -- Multi Currency Feature -- Transaction Currency

Microsoft Dynamics CRM 4.0 is a multicurrency system, in which each record can be associated with its own currency. This currency is called the transaction currency. The multicurrency features enable users to perform financial transactions like opportunities, quotes, orders, and invoices in multiple currencies. This feature also provides a currency choice to the end user when a financial transaction occurs.

Multiple records in different transaction currencies can be aggregated, compared, or analyzed with regard to a single currency, by using an exchange rate. This is known as the base currency. You first define a base currency for the organization and then define exchange rates to associate the base currency with transaction currencies. The base currency is the currency in which other currencies are quoted. The exchange rate is the value of a transaction currency equal to one base currency.

By using the transaction currency properties you can do the following:

• Select the currency in which you want to define and transact opportunities, quotes, orders, and invoices.
• Define currency exchange rates in relation to the base currency.
• Define transaction currencies and define an exchange rate to associate the base currency with the transaction currency.
• Capture the value of the transaction in the base currency and the transaction currency in all financial transactions.
• Define product pricelists for each currency.

To use multiple currencies, the base currency must be defined for an organization during server installation and organization setup. After the base currency is set for an organization during server installation, it cannot be changed. This value is stored in the organization.basecurrencyid property.

Transaction currencies are defined as a part of the system settings. There can be unlimited transaction currencies defined. Transaction currencies are related to the base currency with the definition of a currency exchange rate.

After the definition of base and transaction currencies, the pricelists must be defined for a currency. An organization can have multiple pricelists, which are also typically defined for a target geographical market in the local currency.

All entities that are involved in financial transactions support transaction currency. The currency is typically inherited from the account, opportunity, and so on, but can be changed as needed.

All money properties in an entity instance share the same transaction currency. For example, see the account.creditlimit property. For each money property in an entity, the system automatically creates a corresponding read-only, system calculated, money property that is called the "base". This is a money property that stores the value of the corresponding property in a base currency equivalent. For example, see the account.creditlimit_base property.

The following formula is used to calculate the base value.

creditlimit_base = creditlimit / exchangerate

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