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How to run cash & bank Foreign Currency Revaluation in D365 F&O

September 3, 2025

Content

Cash & bank foreign currency revaluation explained
Step-by-step process for cash & bank revaluation in D365FO
Step 1: Run the cash & bank foreign currency revaluation
Step 2: Review the revaluation voucher
Step 3: Understand the posted entries
Why cash & bank revaluation matters?
Conclusion

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For organizations managing bank accounts in multiple currencies, exchange rate movements can create unexpected shifts in reported cash balances. Even small fluctuations can distort financial results, making it harder to present an accurate picture at the end.

Handling this manually often leads to inefficiencies and inconsistencies. For D365F&O users, the good news is that this ERP includes a dedicated cash & bank foreign currency revaluation feature. It automatically adjusts balances using the latest exchange rates and posts the necessary foreign currency revaluation accounting entries, reducing effort while improving accuracy.

Using this feature, finance teams can gain reliable reporting, better control over foreign currency assets, and clear audit trails that stand up to scrutiny.

This is the third blog in our series on foreign currency revaluation in Dynamics 365 F&O. In Part 3, we’ll focus specifically on:

Running Cash & Bank revaluation in D365FO
Reviewing vouchers generated by the process
Understanding how unrealized gains and losses are posted

Cash & bank foreign currency revaluation explained

The cash & bank revaluation feature in D365 Finance & Operations is designed to revalue bank accounts held in foreign currencies. It ensures that balances are updated to reflect current exchange rates, helping finance teams present accurate foreign currency assets and liabilities while minimizing risks from currency fluctuations.

By automating the creation of foreign currency revaluation accounting entries, this functionality eliminates manual errors, strengthens compliance with IFRS and GAAP, and provides complete transparency through audit-ready vouchers.

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Step-by-step process for cash & bank revaluation in D365FO

Performing D365 foreign currency revaluation in cash & bank is straightforward. Here’s how it is done:

Step 1: Run the cash & bank foreign currency revaluation

Navigate to Cash & Bank Management > Periodic Tasks > Foreign Currency Revaluation.

Click on Foreign Currency Revaluation

Enter the required details, including:
- Revaluation Date
- Exchange Rate Date
- Legal Entity
- Bank account you want to revalue
Once details are entered, click OK. The system will post the foreign currency revaluation (FCR) automatically.

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Step 2: Review the revaluation voucher

After execution, select the relevant FCR transaction and click Voucher.
The system-generated voucher will show whether an unrealized gain or unrealized loss was posted.

Further reading: Step-by-step guide to Accounts Receivable foreign currency revaluation in D365 F&O

Step 3: Understand the posted entries

The system records foreign currency revaluation accounting entries as follows:

- If there is an Unrealized Gain:

Description	DR	CR
Bank a/c	xxx
Unrealized Gain/Loss a/c		xxx

- If there is an Unrealized Loss:

Description	DR	CR
Bank a/c		xxx
Unrealized Gain/Loss a/c	xxx

Below is the voucher for the FCR transaction we posted above.

This ensures that foreign currency revaluation examples are consistently reflected in the bank account balances and general ledger.

Why cash & bank revaluation matters?

Compliance and accuracy – Ensure cash balances are always updated with the latest exchange rates, keeping financial statements aligned with international accounting standards.
Risk management – Minimizes the impact of currency fluctuations by identifying unrealized gains and losses before they affect overall financial results.
Operational efficiency – Automates the revaluation process and posting of entries, saving time and reducing manual effort during period-end close.
Audit-ready transparency – Generates clear, traceable vouchers for every revaluation, strengthening internal controls and simplifying audits.

Conclusion

Accurate cash and bank foreign currency revaluation is essential for organizations managing global operations. By automating this process, Dynamics 365 Finance & Operations ensures compliance with accounting standards, reduces exposure to currency risks, and delivers transparent foreign currency revaluation accounting entries that auditors and finance teams can rely on. This wraps up Part 3 of our blog series on foreign currency revaluation in D365FO. In the final installment, Part 4, we’ll explore General Ledger revaluation, completing the end-to-end view of how Dynamics 365 helps businesses manage currency volatility with confidence. Looking for expert guidance on setting up and optimizing foreign currency revaluation in Dynamics 365? Reach out to us at marketing@confiz.com

About the author

Muhammad Ammar Ali

Ammar is a Microsoft Dynamics 365 Functional Consultant with a focus on Finance and Manufacturing. He brings hands-on experience in...

Ammar is a Microsoft Dynamics 365 Functional Consultant with a focus on Finance and Manufacturing. He brings hands-on experience in streamlining business processes, driving ERP implementations, and delivering solutions that add measurable value. His expertise lies in aligning system capabilities with operational needs to improve overall business performance.

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