We are a US-owned company with subsidiaries in Mexico. Under US GAAP, when a lease is denominated in a currency different from the entity’s functional currency (e.g., a Mexican entity with USD leases but functional currency in MXN, or vice versa), we are required to use the historical exchange rate (from the lease commencement date) for the asset side, and the current rate for the liability side, for all lease accounting entries.
Currently, IFS only allows us to use the current rate for both sides, and does not support assigning a unique historical rate per lease. This results in incorrect accounting and forces us to do manual adjustments outside the system.
Has anyone else encountered this issue? How are other companies handling GAAP lease accounting in IFS when the lease currency and functional currency differ? Are there any workarounds or customizations you have implemented to address this requirement?
Thank you for any insights or solutions!