I have a bank account in Euros which ws open with an initial Balance when I joined QF. My accountant reconcialiated 2023 accounts to match bank statements in the YE report and the Trail Balace. However, we see that the Bank Account Balance is different to the one shown Trial Balnce Report. I understand that the former is EUR and the later is GBP. I also noticied that exported transaction from he bank account shows journal values being the same for both currencies, which is kind of wrong.
I have already verified all uploaded transactions vs bank statements for years 23 and 24 which are both already filed. That bank account should have Zero Euros as per ban statements. However, the difference between QF Bank transactions and Statement transactions is only the journals. But w.out the journals the Trial Balance Reort wouldn’t be Zero for such account.
What can we do make All QF Bank and Trial show the same as Statements, Zero EUR/GBP.
The GBP equivalent balance in foreign currency bank accounts will naturally drift over time as you enter transactions at exchange rates that differ from the official rate on that day. There’s an option in the settings page for non-GBP bank accounts to “record a currency gain/loss”, which calculates the current GBP value of the EUR balance and then creates a special kind of journal that adjusts the GBP balance sheet value to match this calculated value without changing the EUR balance.
The balancing entry for this revaluation journal goes on the “currency charges” P&L nominal so the gain or loss will be realised in the current year’s P&L, so it’s a good idea to do this revaluation exercise for each of your foreign currency accounts at least once per accounting year (typically on the last day of the year), but it doesn’t hurt to do it more often if you want an accurate balance sheet value.
Thanks for the reply. I checked this solution and I think it’s similar to what the accountant already did for the closed years. Such gains have been already calcualted manually and journaled.
The problem is that EUR account shows non-zero balance while other reports like Trial Balance (zero balance) and Balance Sheet doesn’t show such account as part of the assets.
The problem is not about balancing or reconciliating the EUR account. The problem is that the EUR account has different balance depending on which view/report you look at.
If you create a “normal” journal that touches the GBP nominal value of a foreign currency account, then it will also affect the EUR balance as per the exchange rate on the date if the journal. It is only the special “record a currency gain/loss” journals that adjust the GBP amount without changing the EUR amount.
Delete the regular journal lines that fixed up the balance sheet to get the EUR account foreign balance back to zero, then use the record a gain/loss option to do the same job without affecting the EUR amount.
As I said in the initial message, year 22/23 is filed and locked . Year 23/24 is filed but not locked yet.
My accountant tried to follow the proceess of “record a currency gain/loss” to see what happens. The P&L and Trial Balance showed that EUR account at Non-Zero. Then, the account balance in Dashboard changed to opposite direction but the opening balance was deleted. How does the opening balance can be deleted if it was set to a date back in time? We couldn’t alter that balance as it was for a period that was locked.
The recorded journal was deleted but the account still remain unbalanced. I managed to unlock all historical transactions and restore the opening balance.
Now I have more questions:
I cannot or should not delete transactions from previous years as they are already filed with HMRC, even 23/24
Does this mean that normal journals don’t work for non-GBP accounts?
I cannot or should not delete transactions from previous years as they are already filed with HMRC, even 23/24
You can do this but I would reccomend consulting your accountant first as we (the support team) are not registered accountants.
Does this mean that normal journals don’t work for non-GBP accounts?
If you post a journal to a none GBP account it is done in GBP only at a 1-1 exchange rate. If you need to revalue the Foreign amount on a none GBP account use the Record currency gain/loss option
