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FX Revaluation Split into Operating, Investing and Financing Categories (IFRS 18)

  • July 3, 2026
  • 1 reply
  • 51 views
B
Sidekick (Partner)
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Dear Experts,

We are currently evaluating the impact of IFRS 18 on our IFS setup.

One requirement is to classify foreign exchange differences into the categories Operating, Investing and Financing, based on the underlying transaction or balance. This means that FX revaluations on trade receivables/payables should be presented differently from FX revaluations on loans or investments. But there are edge cases, for instance when a supplier might be used for operating as well as investing activities.

I am interested to understand how others have approached this in IFS.

Our challenge is that the standard currency revaluation process posts unrealised FX gains/losses without an obvious distinction between the underlying business nature of the balance. 

Questions:

  • How have you differentiated FX revaluations between Operating, Investing and Financing?
  • Did you solve this through separate accounts, posting control, code parts, account groups, reporting logic, or another approach?
  • Are you able to derive the category automatically from the underlying balance sheet account?
  • Have you implemented this already for IFRS 18 or are you currently analysing possible solutions?

I would appreciate hearing about both standard IFS solutions and any customisations that have worked well in practice.

Thanks in advance for your insights.

1 reply

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Sidekick (Partner)
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  • BytLukasL
  • Author
  • Sidekick (Partner)
  • August 5, 2026

I am closing the loop with our own solution in case someone runs into the same topic.

We decided to derive the IFRS 18 category from the combination of account and posting control, so the unrealised FX gain/loss is steered to a dedicated P&L account per category based on the nature of the underlying balance sheet account. The alternatives we evaluated for this customer were a cost centre or project based derivation and a fully manual classification. Both were dropped, the first one because the dimensions are not consistently available on the original transactions, the second one because it is too time consuming to repeat every period. 

This covers most cases but not all. The typical edge case is the one from my initial question, a supplier or customer used for operating as well as investing activities, where one AP/AR account carries both natures. For those I built a quick report on the AR/AP revaluation transactions that shows the original postings behind each FX gain and loss, meaning the posting accounts of the underlying supplier or customer invoice. On that basis we can identify the affected transactions and reclassify them manually to the correct category. 

Worth knowing: the AR/AP accounts need to be revaluated on transaction level for this to work, and the result depends on the information available on the original transactions.

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