What is exchange rate determination in SAP FS-PM - Policy Management?

SAP Term: exchange rate determination

• Component: FS-PM

• Component Name: Policy Management

• Description: The way in which the exchange rate is determined in a multi-currency contract. You can choose from the following exchange rate determination categories: Fixed: The exchange rate determined in New Business or Contract Renewal is used for currency conversion. Variable: The exchange rate that is valid for the current processing is determined and used for currency conversion.

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• Key Concepts: 
  Exchange rate determination is a component of the Financial Services Policy Management (FS-PM) module in SAP. It allows users to define and manage exchange rates for different currencies. Exchange rates are used to convert one currency into another, and the exchange rate determination component helps users to accurately determine the exchange rate for a given currency pair. 
  
  How to use it: 
  The exchange rate determination component of FS-PM can be used to define and manage exchange rates for different currencies. Users can define the exchange rate for a given currency pair, as well as set up rules for how the exchange rate should be determined. The component also allows users to view historical exchange rates and analyze trends in order to make more informed decisions about future exchange rates. 
  
  Tips & Tricks: 
  When setting up the exchange rate determination component, it is important to consider the current market conditions and any potential changes that may occur in the future. Additionally, it is important to ensure that the rules set up for determining the exchange rate are accurate and up-to-date. 
  
  Related Information: 
  For more information on the FS-PM Policy Management module, please refer to SAP's official documentation: https://help.sap.com/viewer/product/FS_PM/1.0/en-US