What is reference currency in SAP PA-CM - Compensation Management?

SAP Term: reference currency

• Component: PA-CM

• Component Name: Compensation Management

• Description: A currency into which the system converts budget amounts that were created in various currencies. This lets you perform a consistency check for the overall budget across national boundaries.

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• Key Concepts: 
  Reference currency is a feature in SAP's Compensation Management (PA-CM) component that allows users to define a currency for each employee. This currency is used to calculate the employee's salary and other compensation-related payments. The reference currency is also used to convert the employee's salary into other currencies, if necessary. 
  
  How to use it: 
  To set up a reference currency for an employee, go to the PA-CM component in SAP and select the “Reference Currency” tab. From there, you can select the currency you want to use for the employee. Once you have selected the currency, it will be used for all salary calculations and payments related to that employee. 
  
  Tips & Tricks: 
  When setting up a reference currency for an employee, make sure that you select the correct currency for their home country. This will ensure that all salary calculations and payments are accurate and in line with local regulations. 
  
  Related Information: 
  For more information on setting up reference currencies in SAP's Compensation Management component, please refer to the official SAP documentation.