Hi Abdel,
You described it correctly, these are the two ways to calculate the amounts in the parallel currencies.
The difference can occur if you use different exchange rate types for each of the conversions. If, for example,
- you have a local currency (10) as EUR and 2nd currency USD,
- M-rate is 1,25 (used from transaction currency to EUR) and another GRP rate is 1,30 (used from currency "10" to the 2nd one)
- you choose option 2 for conversion (i.e., transaction is first translated to EUR and then from EUR to USD)
... then an invoice for 100 USD will show up as 80 EUR in local currency "10" (= 100 / 1,25) and as 104 USD in your 2nd currency (= 80 * 1,30).
It looks wrong on the first glance, but many companies prefer it this way, because this translates the data from the local accounting without making exceptions for domestic vs foreign transactions. The only case where this would make trouble in consolidation would be intercompany trade (because receivables and payables in the two companies would not match).
Good luck!
