Oracle Financial Consolidation Hub User Manual page 94

Assigning Translation Methods
You assign translation methods at the level of the relationship between two entities.
When you create or update a consolidation hierarchy, specify a translation method for
any child entity whose currency differs from its parent's currency.
See: Creating Consolidation Hierarchy Structures, page 13-6
Selected User Interface Elements for Setting Up Translation Methods
Selected user interface elements are described below.
Ending Rate Type and Average Rate Type
Ending rates are generally used to translate balance sheet accounts. Average rates are
generally used to translate income statement accounts. Since Oracle Applications offer
the ability to enter multiple conversion rates for a given currency pair, specify which
conversion rate type to use for ending rates and which types to use for average rates.
Common examples of rate types are Corporate and Spot, though you can define
additional rate types as needed. You should have rate types which represent the ending
and average rates needed for translation.
See: Currency Rates Manager, Oracle General Ledger User Guide
Equity Mode
You can specify whether you want Financial Consolidation Hub to use the Year-to-Date
(YTD) balances or period activity (PTD) to translate equity accounts, such as retained
earnings and other equity accounts.
A YTD specification translates ending balances using the ending rate. The period
activity is then calculated from the difference between the current period's ending
balance and prior period's ending balance.
A PTD specification translates current period activity using the average rate. The
ending balance is then calculated by summing the translated period activity and the
prior period's ending translated balance.
The most common option in accordance with FAS 52 and IAS 21 is to use the YTD
option for equity accounts.
12-2 Oracle Financial Consolidation Hub User's Guide
Note:
Once a relationship is part of a consolidation process, the
translation method can no longer be updated.
Note:
Regardless of the equity mode you choose, if you enter an
historical rate or amount for a given equity account, Financial
Consolidation Hub translates that account using the historical rate or