How to tag cross currency transfers

[rubaba]

Evening All.

Please can someone guide me the easiest method to tag payments in the following scenario?
I have a HSBC Sterling & HSBC Euro account. I use a third party company to convert my gbp to euro or vice versa as they give better rates than my bank. So in the following example:

£1=€1.5

1- HSBC sterling account sends £100 to third party company-
2- Third-party company sends €150 Euros to HSBC Euro Account-

Thanks in advance

[ian_roberts]

If the money arrives in your Euro account on the same day it left your GBP account and there’s no explicit fee from the third party then I guess you could just tag it as a bank transfer. Otherwise you’ll need a third intermediary “holding” account, tag the money out of your GBP and the money into your EUR accounts as transfers to/from there, and account for any fees as payments out of the holding account.

This is what I do when I make a TransferWise payment to my German suppliers - I have a GBP-denominated holding account in QuickFile, tag the money out of my current account as a transfer to there, and the “amount converted” as money out of the holding account to make payment to the supplier (this would be the bank transfer to EUR for you). The residual balance in the holding account is the fee from TransferWise which I treat as bank charges.

[rubaba]

Thanks for this. Will give is a shot now and see how it works out.

What would you do in the scenario if the gbp to third party transfer is 100k gbp today- third party sends you 50k worth of euros today- and the remaining 50k a week or so later.

[ian_roberts]

In principle this should be no different - set up a holding account, transfer the 100k GBP to there today, then do two separate transfers of 50k on the relevant dates to your EUR bank account, setting the correct amount of Euros you received on each occasion. The end of this process might be a convenient point to record the currency loss/gain on the EUR account, which revalues the EUR balance at the current GBP exchange rate and moves the loss/gain to currency charges.

[rubaba]

@ian_roberts

The end of this process might be a convenient point to record the currency loss/gain on the EUR account, which revalues the EUR balance at the current GBP exchange rate and moves the loss/gain to currency charges.

Thanks for your help so far. Would it be possible to show how the above will be done?

[ian_roberts]

Invoicing in foreign currencies

Introduction 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. [image] From the multi-currency settin…

(The preview says “invoicing in foreign currencies” but the section I’ve actually linked to explains the revaluation journal process)