Applies to Product - Dynamics 365 Business Central
What’s happening?
Customers are experiencing issues where applying a payment made in local currency to a foreign currency invoice, it does not post the released foreign gain or loss against the applied invoice, resulting in unapplied amounts.
Reason:
The underlying cause of this is related to the system design, which calculates realized losses or gains on the invoice based on the difference between the exchange rate on the day of posting the original document and the day of payment. If there is no change in the exchange rate, no gain or loss will be posted.
Resolution:
- If the payment uses the local currency amount from the initial invoice, there may be remaining amounts on the payment or the invoice may not be fully closed due to the realized loss from the exchange rate.
- To make the payment zero in such scenarios, utilize a journal to close out the remaining value.
- Alternatively, consider using a different posting date from the document date in the future if you intend to always use the initial invoice local currency amount. This allows the document date to reflect when the transaction was made in the bank, while the posting date will ensure the payment utilizes the original invoice amount.
- If the second method is not viable for accounting purposes, the only option is to use a journal to correct the remaining or missing amounts needed to close off the payment or invoice. It is advisable to have a dedicated account for tracking these adjustments to avoid interference with the realized loss/gains accounts.