Hi All. Quick question with the best practice regarding the subsidiary currency. Our external auditor advised us to change the currency for one of the subsidiaries as the majority of the sales are from outside the country. Currently, the subsidiary setup follows the local currency. Is it right? I have opposed it for now as it will impact our local transactions and would require subsidiary modification if so. Anyone knows the best practice regarding the subsidiary currency setup?

If the change is in compliance with GAAP or IFRSs, you do really have to change your base or functional currency. But I don't think you are allowed to change the base currency anymore in NetSuite. This is interesting. I'd also like to hear from others. By the way, is it the ultimate parent? Does it have child sub/s if it is not the ultimate parent?

Thanks Luis. It is not the parent subsidiary. But it will affect our local transactions like salary, expenses etc, if we change it. Yes, not allowed now coz we have ample of transactions for this subsidiary already. I thought we should follow the currency of the country where we file our reports like taxes, etc.?

Are you following US GAAP or IFRSs? I think there is a misunderstanding here. You can still pay your transactions using your local currency. Changing the base currency will not have an impact, in general, on the operations side. What will happen after the change is that FOR ACCOUNTING purposes, all your transactions will be converted to the NEW base currency. Again, this doesn't mean that you can't pay using local currency. You still can but the amounts will be converted to the NEW base currency for GL impact purposes.

Thanks Luis! ❤️