TTM vs TTS vs TTB: Which Exchange Rate for Expense Reports?

If you file business expense reports involving foreign currency, the answer is straightforward: most Japanese companies require TTM. Here is what each rate means and when to use it.

Definitions at a Glance

• TTM (Telegraphic Transfer Middle rate): The mid-market rate published daily by Japanese banks. It is the average of TTS and TTB.
• TTS (Telegraphic Transfer Selling rate): The rate at which a bank sells foreign currency to you. Always higher than TTM.
• TTB (Telegraphic Transfer Buying rate): The rate at which a bank buys foreign currency from you. Always lower than TTM.

Quick Comparison Table

Rate

Direction

Formula

Typical Use

TTS	You buy foreign currency	TTM + bank margin (~1 JPY for USD)	Purchasing abroad, remittances out
TTM	Reference midpoint	(TTS + TTB) / 2	Expense reports, accounting
TTB	You sell foreign currency	TTM - bank margin (~1 JPY for USD)	Revenue received in foreign currency

Which Rate for Expense Reports?

TTM is the standard for the vast majority of Japanese corporations. Here is why:

1. Corporate tax law reference: Japan's National Tax Agency accepts TTM as a reasonable rate for foreign currency conversions in corporate accounting
2. Simplicity: One rate per currency per day, no ambiguity
3. Fairness: TTM sits between buy and sell, reflecting the true market midpoint

Some companies adopt stricter policies:

• TTS for expenses: A conservative approach that reflects the actual cost of buying foreign currency. This results in slightly higher yen amounts for expenses.
• Company-fixed rate: Some firms set a monthly or quarterly fixed rate to simplify batch processing.

Japanese Corporate Accounting Rules

Under Japanese GAAP, companies may use any of the following for foreign currency translation:

1. TTM on transaction date (most common)
2. TTS/TTB on transaction date (acceptable, must be consistent)
3. Average rate for the month (allowed for routine transactions under certain conditions)
4. Forward contract rate (if hedging is in place)

The key rule is consistency -- once you choose a method, apply it uniformly across the fiscal year.

Where to Find TTM Rates

• MUFG: Publishes daily rates around 10:00 AM JST on their website
• Mizuho Bank: Available on their foreign exchange page
• SMBC: Published on their rates page each business day

For weekends and holidays, use the most recent business day's rate.

Use Zenrate Business Mode

Zenrate's Business mode lets you toggle between TTM, TTS, and TTB rates and generates a rate evidence block with the source, date, and rate type. You can attach this directly to your expense report as supporting documentation, saving time and ensuring compliance.