In SAP Financial Accounting, how many parallel currencies can be defined for a company code, and at what organizational level are they assigned?

Introduction / Context:
Parallel currencies in SAP allow a company code to record transactions in more than one currency, for example the local currency, a group currency, and a hard currency. This is important for international organizations that must report financial data in multiple currencies. This question asks how many parallel currencies can be defined and at which organizational level they are assigned.

Given Data / Assumptions:

- The company code is the main organizational unit for external accounting in SAP. - Currency settings are crucial for posting and reporting. - SAP supports one local currency plus additional currencies for parallel valuation. - The question focuses on the maximum number of local or parallel currencies and where they are configured.

Concept / Approach:
In classic SAP Financial Accounting, a company code can have one local currency and up to two additional currencies, leading to a total of three currencies maintained in parallel. These currencies are defined at company code level because they affect how postings are stored in the ledgers for that specific legal entity. Chart of accounts level is used for account structures and does not control currency settings for postings. Understanding this separation helps ensure that currency configuration is done in the correct part of the system.

Step-by-Step Solution:
Step 1: Recall that the first currency for a company code is the local currency, usually the legal reporting currency of the country. Step 2: Recognize that SAP allows up to two additional currencies for parallel valuation, such as group currency and hard currency, giving a total of three currencies. Step 3: Understand that these currencies are defined in the company code settings and not at chart of accounts level. Step 4: Evaluate the options and identify that option b states three local currencies at company code level, which reflects the maximum number of parallel currencies maintained there. Step 5: Select option b as the correct answer.

Verification / Alternative check:
In SAP configuration for company codes, there is a section where you define the local currency and additional currencies. You can specify up to two additional currencies besides the local one. Reporting at general ledger and line item level will then show values in all defined currencies. There is no equivalent configuration at chart of accounts level that would define currencies for posting, confirming that the assignment is at company code level and that up to three currencies can be used.

Why Other Options Are Wrong:
Option a is wrong because SAP allows up to three currencies at company code level, not just two. Options c and d are incorrect because chart of accounts level deals with account structures and does not define posting currencies. Currency configuration for parallel valuation belongs to the company code, where legal entity specific requirements are handled.

Common Pitfalls:
A common pitfall is confusing group currency with local currency and not planning currency requirements early in the project. Another mistake is assuming that additional currencies can be added easily later, when in reality this can be technically complex. Understanding that up to three currencies can be defined at company code level helps you design a currency concept that supports both local and group reporting from the start.

Final Answer:
In SAP Financial Accounting, a company code can have up to three parallel currencies defined at company code level. Therefore, the correct option is Three local currencies can be defined at company code level.