I’m sure there is a really simple explanation for this - but I need to be told it!
My $ bank account statement shows $140 and this is shown in the QF bank account screen. All the transactions are shown correctly in the bank.
However, when I bring up the balance sheet, the $ account shows a balance of £1,500.
The account has only existed for 6 months and only has 20 transactions.
Is it some sort of FX gain due to the way the movements in and out have been booked by QF? I can’t think what else it could be. If so, do I correct it by translating my $140 balance to £ at 30/9/14 = £87 and booking the difference (£1500-87) as an exchange loss?
I thought FX gains/losses were already sorted as I see entries for them in the P&L? Just checked the entry in the P&L - it wouldn’t net off - correcting (reducing) my bank in the nominal so it’s the same as the statement would add to the loss already in the P&L.
The account was brand new when I started entering it in QF - so opening balance is £nil
Looking at the FX loss currently in the P&L - it seems this has all been auto-generated as I’ve logged $ payments of $ invoices.
What isn’t in there are any entries on the dates of several movements of cash from the $ account to the £ account. Should an FX gain/loss be generated on such a movement? I book it by entering the amount on the $ statement and the amount on the £ statement (as prompted by QF) so the bank accounts in QF tally with the statements. But would a movement cause an FX loss? It doesn’t as such but I suppose it might depending on how QF translates th to the nominal. If it does books to the nominal at the days official rate (or whatever) this is almost bound to be better than the bank’s rate so would cause a loss.
Am I:
a) Making sense?
b) On the right track?
What do you think? Perhaps it needs the developers to confirm how QF handles such a movement.
Just looked at the nominal. The £ amount in it is the same as in the £ statement - so transfers arent generating the losses.
I’ll try to have an item by item look. I’m sure I’ve done something like booked a paid invoice incorrectly in the early days of the account (ie when handled $ in QF was new to me)
Everything seems to check out here. I looked at all 20 transactions on the dollar account and the sterling equivalent correlates with the exchange rates. There is likely to be some variation due to the large amounts involved (some invoices over 50k) and the rounding differences. So the GBP and USD amounts are never going to exactly resolve at a 1.6/1.7 ratio.
From the bank settings page you can journal a change to just the GBP total and move this into the currency loss/gain account. That’s typically what happens on foreign currency accounts at the year-end.
Thanks, Glenn. Really appreciate your looking at this. So quickly as well.
I’m glad i’m not going completely mad.
I’ll do as you suggest and book an FX difference manually. I know all the bank accounts are right (as they match the paper statements) and my debtors are right, so, one way or another, it must be be FX.
