How to Handle Currency Conversion in Primavera P6

Managing costs in different currencies within Primavera P6 requires a clear understanding of its limitations. Primavera P6 only supports a single currency per project, determined by the project’s default currency settings. This means that every cost resource and activity in the project will ultimately be calculated in the same currency.

We will explore how to manage currency conversion in Primavera P6 when dealing with projects involving costs in two currencies. However, in our case, the client requires a different approach: one resource for activities with costs in USD and another resource for activities with costs in SAR. This guide shows you how to achieve this setup while adhering to Primavera’s single-currency framework.

Key Limitation: Single Currency Per Project

We will add two resources: one for the default currency and another for the foreign currency. Costs will be entered in the budgeted units field, ensuring that the resource currency matches the project currency. This guarantees accurate currency conversion when the project currency is changed.

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If you want to change the project currency from one currency to another, this article will show in steps, But if you want to know how to add currency check this Article

Single Currency Per Project

Primavera P6 cannot handle multiple currencies at once. All costs are assumed to be in the project’s default currency. For example, if your project currency is set to SAR (Saudi Riyals), all costs—including those created in USD (U.S. Dollars) will be converted and calculated in SAR.

Main Steps

1. Create Resources for Each Currency

2. Set the Project Currency

3. Verify the Conversion Rate

4. Assign Costs Using Budgeted Units

5. Verify Cost Assignments

6. Reporting and Documentation

Step 1: Create Resources for Each Currency

To manage costs in USD and SAR, create separate resources:

Create the USD Resource:
- Go to Enterprise > Resources.
- Add a new resource and name it “USD Currency”
- In the resource details, set the Currency to USD.
- Ensure the Default Rate is set to 0
- Ensure that you check “Calculate Cost from Units”

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- Ensure the Standard Rate is set to 1.

Create the SAR Resource:
- Similarly, create another resource and name it “SAR Currency”
- In the resource details, set the Currency to SAR.
- Ensure the Default Rate is set to 0
- Ensure that you check “Calculate Cost from Units”

- Ensure the Standard Rate is set to 1.

Step 2: Set the Project Currency

Primavera P6 uses the project’s default currency to calculate all costs. To set the project currency:

Go to Edit > User Preferences.
Navigate to the Currencies tab.
Select the desired project currency (e.g., SAR or USD).

Step 3: Verify the Conversion Rate

To ensure accurate cost reporting and calculations, verify that the conversion rate between currencies is accurate:

Go to Admin > Currencies
Check the exchange rate set for the currencies (e.g., USD to SAR).
Update the exchange rate to reflect the latest rates.
Save the changes to apply the correct conversion rate.
Click Close to save the changes.

Step 3: Assign Costs Using Budgeted Units

Once resources are created and the project currency is set, assign costs to activities using the budgeted units field:

Note: Ensure that the assigned resource matches the project’s default currency otherwise the conversion won’t work.

Assign Costs for USD Activities:

Since the default currency is USD then assign the USD Resource to the related Activity, since the default rate is zero nothing will be assigned so we need to assign the cost to the activity, we will put the cost in the Budgeted unit.

If it is not calculated, from Tools > Recalculate Assignment cost

o The Budgeted Units are 150 $

Assign Costs for SAR Activities:
- Change the Project Currency to match the Resource Currency
- Repeat the above steps for activities requiring costs in SAR.
- Assign the “SAR Cost Resource” and enter the cost amount in SAR in the budgeted units column.
- The Budgeted Units are 100 SAR

Step 4: Verify Cost Assignments

To ensure accuracy, verify the following:

Each activity has been assigned the correct resource (USD or SAR).
All costs are reflected correctly in the budgeted units and calculated values.
If you change the project currency the Cost is equal in Different Currencies.

Consider a scenario where the same project is managed in two different currencies. In the first instance, the project currency is set to USD, and the total budgeted cost is 177 USD. In the second instance, the project currency is set to SAR, and the total budgeted cost is 663 SAR

When you notice that the Budgeted units in the SAR Activity are the same, but the Budgeted Costs are different according to the project Currency. The Budgeted units and The Budgeted cost are equal to 100 as the Project currency equals to the Resource Currency.

The Same Activity SAR but in USD project currency, the Budgeted Units are still the same, but the Budgeted Cost is 27 $ after the Conversion. The same points are applied to the USD activity

Step 5: Reporting and Documentation

When generating reports, clearly label costs in their respective currencies. Use the following guidelines:

Add a column for the resource name to identify the currency type (USD or SAR).
Include notes or legends in your report to indicate the exchange rate used if conversions are required.
Confirm that all costs align with the project’s default currency in the final summaries.

Conclusion

By creating separate resources for each currency and carefully assigning costs, you can effectively manage projects with multiple currencies in Primavera P6. Setting the project’s currency and ensuring accurate resource assignments is critical for maintaining consistency and clarity in project management. Additionally, verifying the conversion rate ensures accurate reporting and avoids discrepancies. Use this step-by-step approach to streamline the process and ensure accurate reporting.

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