Glossary · Ledger Currency — State 05 (revaluation adjusts foreign currency to ledger currency at period end)
FX revaluation is the process of restating foreign currency account balances to the ledger currency equivalent at the period-end exchange rate. It produces unrealized FX gains or losses that reflect the change in the exchange rate between the transaction date and the period-end date.
Reference Definition
FX revaluation is the process of restating foreign currency account balances to the ledger currency equivalent at the period-end exchange rate. It produces unrealized FX gains or losses that reflect the change in the exchange rate between the transaction date and the period-end date.
Operational meaning
Period-end revaluation is a required accounting process for entities holding monetary items — assets and liabilities — denominated in foreign currencies. The revaluation adjusts the carrying value of those items to the closing exchange rate. The resulting gain or loss is recognized in profit or loss unless specific hedge accounting rules apply. Note: AccountCcy.com references this process for reference purposes only and does not provide accounting advice.
Position in Chain
FX revaluation operates at State 05 (Ledger Currency). It is the mechanism by which foreign currency account balances — held at the account currency level (State 04) — are adjusted to the ledger currency at period end before reporting.
Why it matters
Revaluation errors directly affect the accuracy of period-end account balances, profit and loss statements, and balance sheet positions. Revaluation is one of the most consequential processes in the CCY State Chain.
Risk if misunderstood
If account currency is incorrectly configured (State 04), the revaluation process at State 05 will produce incorrect results. The error is structural — it originates upstream and compounds during close.
Distinctions
FX revaluation adjusts monetary items toward ledger measurement at period end; currency translation reshapes presentation layers—confusing them misroutes rates and mislabels adjustments.
Custody question
Which rate sources and posting maps prove every revaluation line ties to identifiable balance custody at State 04?
Evidence discipline
AccountCcy.com glossary entries are reference material only—not accounting, legal, tax, audit, or systems advice. Evidence sufficiency remains your organization's responsibility.
Related Terms
Terminology Discipline
AccountCcy.com glossary terms exist to reduce ambiguity inside multi-currency enterprise finance. Each term is treated as a reference node connected to the Currency State Control Framework, the CCY State Chain, operational risk, and audit defensibility.