Foreign Currency Customer Balance and Accounts Receivable Discrepancy

Hi arifai,

It's great to see you reaching out here.  Welcome!  When situations like this arise, with QuickBooks Online multicurrency, it's best to connect with us outside of Community.  This will provide a member of our Customer Care team with the ability to work with you virtually, with your consent.  In addition, it will provide a better understanding of how the transactions have been recorded, and ensure the associated accounts are balanced as soon as possible!

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I tried that twice already, and they could not help me.

I'd like to make sure you get the help you need. Were you provided a reason  elaborating why you couldn't be helped further? 

They were unsure of how to resolve the issue for me.

I see. Normally, when a workaround isn't provided you're given the option to escalate so our engineers can look into this further. Was this option offered to you? If not, contacting our support team outside of the Community will ensure you get the issue escalated. It's important to note that product limitations aren't escalated, however, you can send feedback directly to our engineers to let them know about the functions and features you'd like to see in the program. To do this, click on the Gear icon > and look for Feedback. Let me know if you have other questions, I'm here to help. 

I have shared my feedback as directed.

In the meantime, is there no one in the QB community that knows a resolution for this? I can't be the only one to have experienced this.

The issue could be the ROE conversion that was used by QB. 

Are you able to view what entry/entries are causing the open balance amount of 120.46 CAD? 

For one of my credit memos the ROE didn't match the invoice it was to clear so even through the USD value was good the CAD equivalent was off.  Once I figured that out I was able to update the ROE used for the credit memo entry so that it would clear out the correct CAD value.  

Hi Andrea,

Thanks for your message. I know the variance is from a 2018 payment to two USD invoices. But rather than changing the exchange rate on the 2018 payment, I'd like to make an adjusting entry to avoid changing a fiscal period that's already been closed and filed for taxes.

Hi arifai,

As mentioned by AdminAndrea, making changes or adjustments to historical transactions can have a negative impact on other areas of your books.  For this reason, it's best to speak with an accounting professional for the best course of action.  If you don't have an accountant, we can help you locate a ProAdvisor in your local area.

If you have other questions or concerns, please don't hesitate to reach out.  We'd be glad to assist!

I was able to clear the A/R balance by entering a JE for the $120.46 CAD at the highest ROE possible to avoid creating an open USD balance for the customer.

Thanks.

Excellent!  

Can you please share a screen shot of the JE? I'm also facing the same problem.

Dear Community,

I have the exact same problem and would like to solve it as well. Sorry, but as a beginner in quickbooks the explanation was not understandable enough for me:

what does "at the highest ROE possible" mean?

I am grateful for any help.

Best regards

Albert

Look no further, Albert. I'm here to help clarify what ''at the highest ROE possible'' means.

When we mention "the highest ROE possible," we are focused on getting the most financial gain from handling different currencies. This means paying close attention to how currency values change and making exchanges at the best time based on market trends and predictions.

Additionally, this practice benefits and impacts your accounts and overall financial balance, so it is best to reach out to your accountant to help you find the appropriate accounts to use when creating journal entries about the ROE (Rate of Exchange). If you don't have one, we can help you find a ProAdvisor nearby.

Moreover, learn how QuickBooks Online (QBO) processes exchange rates for transactions involving foreign currencies: Learn about exchange rates in QuickBooks Online.

Please don't hesitate to write your comment in the Reply button if you have any more questions about the Return of Exchange rate. We’re here to ensure you have the knowledge needed to manage your finances effectively.

ROE means Rate of Exchange.  This is the rate that is captured in QBO.  If your home currency is CAD and you are posting a USD entry, there will be a box (top left) that has two flags to show you what the ROE is at the date the entry is made.  This will show you what the CAD equivalent is for that USD entry.  This is important because you will have all your reports in CAD so the ROE will calculate your USD entry into CAD for reporting etc. 

When you are trying to make an adjustment to an older entry, you need to consider what ROE you will need to use.  Do you use the ROE from the date of the entry or today's date?  Depending what you are trying to accomplish that will outline what ROE you use. 

Does that help?  

Thanks a lot AdminAndrea,

yes, that helps, it gave me the right idea.

I have the same problem as arifai, that I have a balanced balance on a foreign currency account, but the equivalent in home currency has a balance. This was due to a revaluation at the end of the year. 

I would now do the derecognition according to the example of arifai by making a journal entry with an extremely high exchange rate, so that the result is the currency entry at 0.00, but the home currency is corrected in the correct amount.

If I make the posting under today's date, then I also achieve that the annual financial statements of previous years are not changed.

In your view, is there anything to be said against this?
Kind regards, Albert

I don't believe there would be an issue against previous years FS as long as the date you are using is current year.  You can of course do the entry with today's date and then view previous statements to confirm it hasn't affected anything except the current year. 

If you entered this adjustment in a previous fiscal year then it would change the value in that account on that date (for instance, if your year end is Dec 31, then a change made dated 2024-07-07 would affect your 2024 financials statements).  But if you did the adjustment today, even though the original entry that you are clearing is from a previous year, then because the adjustment itself is dated today and shouldn't affect a previous year. 

As always you can ask your accountant for guidance and support to ensure you have captured things correctly.