In the SAP System exchange rates are used for translating monetary amounts into other currencies. The effective
exchange rate is calculated from the exchange rate number in the
exchange rates table and the exchange rate ratios stored in a separate database table.
Example: Average rate USD/ITL = 1.93458, Exch.rate ratio 1 : 1000.
=> Effective average rate: 1 USD = 1934.58 ITL.
A currency pair is made up of a from currency (USD in the above
example) and a to currency (ITL). The exchange rate ratio is also known as the exchange rate factor.
The exchange rate type enables exchange rates to be differentiated
using additional characteristics (e.g. average, buying, selling or
fixed rate). Thus the average rate between two currencies differs from the buying or selling rate.
In the SAP System exchange rates are client-specific, but not tied to any other organizational unit.