How To Fix ME704 - Currency exchange rate & differs from PO rate & by & %

SAP Error Message - Details

• Message type: E = Error

• Message class: ME - Purchasing: General Messages

• Message number: 704

• Message text: Currency exchange rate & differs from PO rate & by & %

What causes this issue?

The currency exchange rate defined in the purchasing document is &V2&,
but the current exchange rate &V1& differs from this by &V3& %. (The
purchase order exchange rate can be specified in the header data of the
purchasing document).

System Response

If the PO currency exchange rate of the purchasing document is fixed,
you cannot change it.

Error message extract from SAP system. Copyright SAP SE.

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• What is the cause and solution for SAP error message ME704 - Currency exchange rate & differs from PO rate & by & % ?

  The SAP error message ME704 indicates that there is a discrepancy between the currency exchange rate used in a purchase order (PO) and the current exchange rate in the system. This error typically arises during the invoice verification process when the system detects that the exchange rate for the invoice does not match the rate that was established in the purchase order by a specified percentage.
  Cause:
  
  Exchange Rate Changes: The exchange rate between the currencies involved has changed since the purchase order was created.
  Incorrect Exchange Rate Configuration: The exchange rates in the system may not be updated or configured correctly.
  Currency Conversion Issues: There may be issues with how the currency conversion is being handled in the system.
  Tolerance Limits: The percentage difference between the PO rate and the invoice rate exceeds the defined tolerance limits in the system.
  
  Solution:
  
  
  Check Exchange Rates:
  
  Verify the exchange rates in the system. You can do this by navigating to the transaction code OB08 (Maintain Exchange Rates) and checking if the rates are up to date.
  If the rates are outdated, update them accordingly.
  
  
  
  Review Purchase Order:
  
  Check the purchase order to confirm the exchange rate that was used when it was created. This can be done by viewing the PO in ME23N (Display Purchase Order).
  Ensure that the currency and exchange rate are correct.
  
  
  
  Adjust Tolerance Limits:
  
  If the discrepancy is within acceptable limits, consider adjusting the tolerance limits for currency differences in the configuration settings. This can be done in the customizing settings under:
  
  SPRO > Materials Management > Purchasing > Invoice Verification > Define Tolerance Limits for Invoice Verification.
  
  
  
  
  
  Manual Adjustment:
  
  If necessary, you can manually adjust the invoice to match the PO rate or vice versa, depending on the business rules and agreements in place.
  
  
  
  Consult with Finance:
  
  If the issue persists, consult with the finance department to ensure that the currency exchange policies are being followed and that there are no underlying issues with the financial data.
  
  
  
  Related Information:
  
  Transaction Codes:
  
  ME23N: Display Purchase Order
  OB08: Maintain Exchange Rates
  MIRO: Invoice Verification
  
  
  Documentation: Review SAP documentation for more details on currency handling and exchange rate configuration.
  SAP Notes: Check for any relevant SAP Notes that may address specific issues related to currency exchange rates and the ME704 error.
  
  By following these steps, you should be able to identify the cause of the ME704 error and implement a solution to resolve it.