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Administrator Guide
Last Updated: 2024-03-08
Concept: Alternate Ledger Currency in Allocations

Concept: Alternate Ledger Currency in Allocations

When you run an allocation for a company that has an alternate ledger currency (ALC) configured, Workday creates either a single-source allocation or a multisource allocation. Workday generates different accounting for each type of allocation. The configuration of the allocation definition determines which type is created.
Intercompany allocations always generate single-source allocations. Nonintercompany allocations, where the target company is the same as the offset company, can generate either single- or multisource allocations.

Single-Source Allocations

Single-source allocations derive from 1 of these sources:
  • A fixed rate amount.
  • A fixed source amount.
  • A single plan structure.
  • The primary ledger of the
    Used By
     company, in the context of intercompany allocations.
Workday also generates a single-source allocation when either the target company or offset company is mapped from the basis, even if the source isn’t one of the above.
All intercompany allocations are single source because Workday only evaluates the primary ledger.
Single-source allocations generate:
  • An allocation result based on the primary currency of the
    Used By
     company.
  • An operational journal in the primary ledger.
  • An operational journal in the alternate ledger.
On the header of each operational journal, Workday displays a link to the other journal.
When generating the alternate operational journal, Workday ignores any
Currency Rate Type
 configured on the allocation definition. Instead, Workday uses the
Alternate Ledger Currency Rate Type Override
 set for the company on the
Edit Company Accounting Details
 task. When you haven't set an ALC rate type override for the company, Workday uses the default currency rate type configured on the
Maintain Currency Rate Types
 task.

Multisource Allocations

Multisource allocations derive from two sources: the primary and alternate ledgers of the source company in a non-intercompany allocation.
Workday generates multisource allocations when all of these conditions apply:
  • ALC is enabled for all source companies.
  • The source on the allocation definition is the Actuals ledger.
  • The target company and offset company are the same as the source company.
When either the target company or offset company is mapped from the basis, Workday generates a single-source allocation even when the conditions for a multisource allocation apply.
Multisource allocations generate:
  • An allocation result for the primary ledger, with the source, target, offset, and associated operational journal in the primary currency.
  • Another allocation result for the alternate ledger, with the source, target, offset, and associated operational journal in the alternate currency.
On the header of each allocation result, Workday displays a link to the other allocation result. For multisource allocations, Workday doesn't display a link between the operational journals.
Note:
  • Workday doesn’t support retroactive allocations when you enable ALC midyear.
  • If you change your ALC start date after you generate allocations for the alternate ledger, you can't rerun those allocations. If this occurs, we recommend that you create new allocation definitions.

Preparing for Alternate Ledger Currency

Before you enable alternate ledger currency for your companies:
  • Finalize or cancel all allocation results in
    Open
     or
    Pro Forma
     status.
  • Disable reversing allocations in the month before you enable alternate ledger currency, to avoid having reversals only for the primary ledger.

Updating Allocation Definitions

When you update an allocation definition, it can change the resulting allocations from single-source to multisource or the other way around. Workday accounts for this change when you rerun allocations that you generated from the previous version of allocation definition.

Allocation Basis

Allocation basis amounts can be used for both the primary and alternate ledger.
When the
Allocation Method
 is
Spread Even
, Workday uses the selected dimensions for both the primary and alternate allocations.
When the
Basis Type
 is:
  • Ledger Accounts
    , Workday can generate amounts from both primary and alternate ledgers independently.
  • Ledger Accounts (Multiple Companies)
    , Workday generates 1 basis using the ledger values from the primary ledger for all of the
    Used By
     companies. The allocation process doesn’t evaluate whether all companies have an alternate ledger, so the primary ledger is used even for multisource allocations.
When the basis is a statistic, Workday uses the same statistic for both primary and alternate allocations, regardless of the statistic type.

Finalizing Allocations

When you’ve configured an ALC for a company, Workday finalizes allocations using the allocation result in the primary currency. For allocations that don't have ALCs, the finalization process is unchanged.
When you finalize a single-source allocation, Workday updates all journals associated with the primary and alternate ledgers.
When you finalize multisource allocations through the
Run Mass Finalize for Allocations
 task, Workday displays primary allocation results only. Once you complete the task, Workday updates alternate allocation results and their associated journals to keep them in sync.
When you want to finalize a multisource allocation through the related actions menu, you can only access the
Finalize Allocation
 task from the primary allocation result.

Canceling Allocations

When you’ve configured ALC for a company, Workday cancels allocations using the allocation result in the primary currency.
When you cancel a single-source allocation result, Workday updates the allocation result and its associated journals on both the primary and alternate ledger.
You can only cancel a multisource allocation from the primary allocation result. When you cancel the primary allocation result, Workday also cancels the alternate allocation result and all associated operational journals on both the primary and alternate ledgers.
When you’ve enabled reversals, canceling an allocation changes the status of the reversal journals to
Canceled
 on both the primary and alternate ledgers.

Reporting on Alternate Ledger Allocations

You can use the
Alternate Ledger Allocations
 report field on the Allocation business object (secured to the
Public Reporting Items
 domain) to report on any alternate allocation results related to an allocation. Workday doesn’t include alternate ledger allocations in any delivered reports. To include links to alternate allocations in any delivered reports, update the reports manually.

Error Handling

To ensure that allocations on both the primary and alternate ledger remain in sync, Workday updates the status of both allocations when an error occurs on:
  • The primary allocation result.
  • The alternate allocation result.
  • Any associated journals.
When an allocation results in a critical exception, Workday also updates the status of the associated operational journals to
Error
.
You can use the
A Problem Exists With
 column on the error grid of the
View Allocation
 report to identify whether an error occurred on a primary or alternate allocation.