Urgent: Exchange Rate Decimal Precision Issue

1. Objective

To address and resolve the issue of insufficient decimal precision (currently limited to 4 decimals) in the exchange rate configuration between the FCFA and the US Dollar (USD). The goal is to allow for at least 8 decimal places to ensure accuracy in financial transactions and reporting.

2. Background

The FCFA (Central African Franc) has a relatively low value against the USD, resulting in exchange rates that are often represented as small decimal fractions. Due to this, even minor rounding or lack of decimal precision can lead to significant discrepancies in converted values.

Currently:

• The system restricts the exchange rate display and calculations to 4 decimal places.

• For example, the actual rate of 0.00171141 USD per 1 FCFA is rounded to 0.0017, which introduces errors.

• A change of 30 FCFA (from 585 to 625) results in only a 0.0001 shift in the displayed exchange rate (from 0.0017 to 0.0016), which is not granular enough for accurate representation.

3. Problem Statement

Limiting exchange rate precision to 4 decimal places causes:

• Inaccurate currency conversions.

• Misleading financial values in reports and transactions.

• Large jumps in apparent exchange rates due to rounding.

• Decreased reliability in systems handling multi-currency transactions.

4. Requirements

Functional Requirements

• FR1: The exchange rate system must support a minimum of 8 decimal places for rate entries and calculations.

• FR2: All interfaces displaying exchange rates (UI, reports, APIs) must reflect the enhanced precision.

• FR3: Rounding logic, if any, should only apply at the display level, not at the storage or calculation level.

Non-Functional Requirements

• NFR1: The change should not degrade system performance during exchange rate calculations.

• NFR2: Historical data must remain valid and accurate post-update.

• NFR3: Adequate testing should be done to ensure backward compatibility.

5. Priority

High – Required to ensure the financial accuracy of transactions involving African currencies, especially FCFA.

6. Stakeholders

• Finance & Accounting Team

• IT Systems/Development Team

• Product Managers

• External Partners (if APIs are affected)

7. Proposed Solution

Update the exchange rate module and database schema (if required) to:

• Store and process exchange rates with at least 8 decimal precisions.

• Ensure all modules consuming exchange rates (including 3rd party integrations) respect the updated format.

8. Timeline

To be determined based on development capacity, with a recommendation to prioritize the change in the next update cycle or patch release.

9. Risks

• Potential data inconsistency if decimal support is added inconsistently across subsystems.

• Possible need for UI redesigns where space or formatting was based on 4 decimals.