Our client pays from GBP to supplier in Spain for invoices in EUR
1/03/19 Money going out from GBP account, 25,307.34.
We record this as transfer to dummy EUR account using exchange rate as per HSBC bank 1.13627904 and pay 10 invoices for the total of EUR 28,756.2.
In EUR bank statement we have Money In 28,756 and Money out 28,756, balance nil.
However on GBP balance sheet it shows Money In 25,307.34, money out 24,655.92. Balance sheet uses
xe.com exchange rate 1.1663.
Balance sheet shows balance on EUR account 651.41. If I journal this to currency charges my bank statement is then off balance, even though balance sheet is fine.
How to deal with this?
Thanks in anticipation
This is normal for foreign currency accounts, the GBP balance will drift as the incoming and outgoing transactions are at different exchange rates. You can correct it using “record currency loss/gain” on the bank account settings:
QuickFile provides full support for multi-currency sales invoicing, purchase invoicing and banking. You can easily raise invoices in over 100 different currencies and QuickFile will automatically track your gains and losses using real-time exchange rate data.
How can I setup Multi-Currency Invoicing?
By default the multi-currency tools are switched off. You can easily activate them from the ‘account settings’ area in your QuickFile account.
From the multi-currency settin…
This is a special type of journal that resets the GBP nominal balance to the current exchange rate
without changing the foreign currency balance, with the matching figure going to currency charges.
That’s great, many thanks for your help!
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