What is revaluation method in SAP FI-LC - Consolidation?

SAP Term: revaluation method

• Component: FI-LC

• Component Name: Consolidation

• Description: A variant within the purchase method, whereby the assets and liabilities involved in consolidation are revalued to their current market value. The alternative to the revaluation method is the book value method.

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• Key Concepts: 
  Revaluation method is a feature of the FI-LC Consolidation component of SAP. It allows for the revaluation of foreign currency balances in a consolidation process. This means that the balances of foreign currency accounts can be converted into the local currency at a rate different from the one used when the transaction was originally posted. 
  
  How to use it: 
  To use the revaluation method, you must first set up a revaluation account in the consolidation system. This account will be used to record any differences between the original exchange rate and the revaluation rate. Once this is done, you can select the revaluation method in the consolidation process and enter the new exchange rate. The system will then automatically convert all foreign currency balances to the local currency at this new rate. 
  
  Tips & Tricks: 
  When using the revaluation method, it is important to remember that any differences between the original exchange rate and the revaluation rate will be recorded in the revaluation account. Therefore, it is important to monitor this account regularly to ensure that any differences are properly accounted for. 
  
  Related Information: 
  For more information on using the revaluation method in SAP FI-LC Consolidation, please refer to SAP Help documentation or contact your SAP support team.