Currencies and Exchange Rates in Rate Management

Currency mistakes are one of the fastest ways to lose trust in quoting. Even when the underlying rates are correct, inconsistent currency handling can produce totals that look wrong, small rounding differences that create disputes, or mismatched reports across teams.

This guide explains how to manage currencies and exchange rates in Velocity Rate Management so rates convert predictably, quote outputs remain consistent, and your team can troubleshoot small discrepancies quickly.

What Currency Data Is Stored at the Rate Line vs Quote Level

To avoid confusion, separate “what is stored” from “what is shown.”

Rate Line Currency (Stored with the Rate)

Each imported or captured rate line should have an explicit currency code (e.g., USD, EUR, GBP, AED). This currency reflects the provider’s cost basis.

Typical rate-line examples:

• Ocean base freight in USD per container
• LCL rate in EUR per CBM
• Air rate in USD per kg
• Surcharges in a provider-specific currency

Key principle: rate-line currency should reflect the original source currency. Do not “guess” currency or leave it blank.

Quote Currency (Customer-Facing Currency)

A quote usually has a presentation currency that matches what the customer expects (often aligned with customer billing terms).

Examples:

• A customer account is billed in EUR, even if buy rates are in USD
• A Middle East lane is quoted in AED, even if carrier costs are in USD

Key principle: quote currency is a presentation decision; rate-line currency is a source-of-truth decision.

When to Convert (Import-Time vs Quote-Time) and Trade-Offs

There are two common approaches to conversion. The correct choice depends on how frequently you update exchange rates and how you want pricing governance to work.

Option 1: Convert at Import-Time

You convert provider rates into a standard internal currency at the moment you upload or store them.

Pros

• Comparisons and reporting are simpler (one internal currency)
• Quote calculations are faster and more consistent
• Less variability due to exchange rate changes after upload

Cons

• If exchange rates change, your stored converted values can become stale
• You must re-upload or re-convert to reflect new FX levels

Best for

• Organizations with less frequent FX updates
• Contract-rate environments where pricing stability is more important than real-time FX

Option 2: Convert at Quote-Time

You store rates in their original currencies and convert only when generating a quote.

Pros

• Always reflects current FX assumptions at the time of quoting
• Reduces the need to re-upload rates just to update FX

Cons

• Totals may vary slightly day to day as FX changes
• Requires clear governance over which FX source is used and when it updates

Best for

• Multi-currency environments with frequent quoting
• Organizations that want FX alignment to the quote issue date

Recommended Practical Model

• Store rate lines in source currency
• Convert at quote-time for customer presentation
• Lock the FX rate used for the quote (so the quote remains consistent after it is issued)

Exchange Rate Source Strategy (Manual vs System-Driven)

Choose one strategy and apply it consistently. Mixed approaches often create discrepancies.

Manual Exchange Rates (Controlled Tables)

Your finance/pricing team maintains exchange rates and updates them on a defined schedule.

Pros

• Strong governance and predictability
• Easy to audit and explain to customers
• Rates can be aligned to invoicing policy

Cons

• Requires process discipline and ownership
• May lag market FX

Best practice

• Define an update cadence (daily/weekly) depending on your business
• Document the policy: “We use FX from [time/cadence] for quoting and billing”

System-Driven Exchange Rates (Automated FX)

Rates are updated automatically from a configured source.

Pros

• Always current
• Less manual overhead

Cons

• Can introduce variability in totals if FX changes frequently
• Requires clear policy for locking FX per quote to prevent disputes

Best practice

• Ensure quotes store the FX snapshot used at the time of creation or issuance
• Ensure reporting and finance workflows align to the same FX logic

Rounding Rules and How They Affect Totals

Small “off by a little” discrepancies are usually rounding—especially when multiple charge lines convert separately.

Where Rounding Happens

Rounding can occur at one or more stages:

1. Rate line conversion (each charge line converted individually)
2. Subtotal rounding (grouping by category, then rounding)
3. Final total rounding (rounding at the end)

Why Totals Can Differ

If you convert and round each line, then sum:

• You may get a slightly different result than summing first and rounding once at the end.

Example scenario:

• 10 line items each round up by 0.01 = 0.10 difference overall

Recommended Policy (Operationally Clean)

• Use a consistent decimal precision per currency (commonly 2 decimals)




• Define whether rounding occurs:

  • per line item, or
  
  
  • at subtotal/total only
  
  


• 
  

  Keep the policy consistent across quoting and reporting

  
  

Tip for Customer Trust

If you provide a detailed breakdown, line-level rounding is usually acceptable—but it must be consistent so totals reconcile.

Multi-Currency Customer Presentation and Reporting

Multi-currency quoting is common in freight pricing. The goal is clarity: customers should understand what currency they are seeing, and internal reporting should stay consistent.

Customer-Facing Best Practices

• Display the quote currency clearly near the total (e.g., “Total: 3,250 EUR”)




• Ensure every line item shows currency or inherits clearly from the quote currency




• If you include both buy and sell views internally, make sure the UI clearly distinguishes:

  • buy currency (source)
  
  
  • sell currency (presentation)
  
  

Internal Reporting Best Practices

Decide your reporting base:

• Report in a single “home” currency for management dashboards, or
• Report in quote currency with consistent conversion rules

To avoid reconciliation issues:

• Use the same FX logic for reporting that you use for quotes, or clearly label differences
• Store the FX snapshot used for each quote so finance can reconcile later

Best Practices Summary

• Store rate lines in the provider’s source currency
• Convert at quote-time for customer presentation, and lock FX per quote
• Choose an FX strategy (manual vs automated) and document the policy
• Standardize rounding rules and apply them consistently across quoting and reporting
• Make quote currency explicit and keep internal buy/sell currencies clearly separated