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leebrendalee
June 21, 2020
Solved

Do need to revalue?

  • June 21, 2020
  • 3 replies
  • 0 views

Each month we record CR USD sales and DR the USD bank

 

Now QBO automatically will calcuate the exchange , so for example

The sales will show as 294.88 USD and it converts to 420.60 CDN

So now that's fine.

On the balance sheet of course we need to show in CDN and again, QBO converts the USD bank to CDN amounts!  Again thats fine.

 

Here's my question, are we suppose to then go to the gear and then currencies and revalue the USD accounts for that particular month?  If so why?  When it converts it creates realized gain or loss but I'm trying to understand in my head if we need to revalue or not  since QBO is converting it already?

 

Best answer by JamesM

Hello there, 

 

Glad to hear from you again. I hope all is well on your end. QuickBooks offers a versatile multi-currency feature which saves you from manual calculations and conversions. I'd be be glad to share more info on this so you can get back to doing what you love. 

 

The Balance Sheet shows the rate of the currency at the time the transaction was entered. When you need your reports to show a current home currency value of your foreign balances, you can enter a home currency adjustment.

 

Here's how: 

  1. Click the Gear icon.
  2. Choose Currencies.
  3. Look for the currency you'd like to change.
  4. Under the Action column, click the Edit currency exchange link.
  5. Choose the Your Rate radio-button.
  6. Update the rate. 
  7. Click Save

I encourage you to learn more about the currency adjustments and multi-currency using the resources below:

In case you have other questions, feel free to contact our support team using this link here. Otherwise, leave a comment below. I'll be one message away. :)

3 replies

J
JamesMAnswer
Level 5
June 22, 2020

Hello there, 

 

Glad to hear from you again. I hope all is well on your end. QuickBooks offers a versatile multi-currency feature which saves you from manual calculations and conversions. I'd be be glad to share more info on this so you can get back to doing what you love. 

 

The Balance Sheet shows the rate of the currency at the time the transaction was entered. When you need your reports to show a current home currency value of your foreign balances, you can enter a home currency adjustment.

 

Here's how: 

  1. Click the Gear icon.
  2. Choose Currencies.
  3. Look for the currency you'd like to change.
  4. Under the Action column, click the Edit currency exchange link.
  5. Choose the Your Rate radio-button.
  6. Update the rate. 
  7. Click Save

I encourage you to learn more about the currency adjustments and multi-currency using the resources below:

In case you have other questions, feel free to contact our support team using this link here. Otherwise, leave a comment below. I'll be one message away. :)

L
leebrendaleeAuthor
June 22, 2020

Awwwe I see.  That makes sense, so let me rephrase just to make sure I have it correct.  The balance sheet shows the "bank balance" etc, at the time of deposits.   But for taxation purposes and proper accounting, we should always revalue?  (and yes still LOVE QBO)

 

Thank you. 

J
JamesM
Level 5
June 23, 2020

Revaluing the amounts is completely up to you. I'll leave this question open so the accounting professionals in the Community can chime in and share their best practices. In the meantime, feel free to ask other questions. I'm here to help.

 

It's good to learn that you love QBO, we love you too, leebrendalee! :) 

Fiat Lux - ASIA
Fiat Lux - ASIA
Level 14
June 23, 2020

@leebrendalee 

You may have other options to deal with multi currency transactions

1. Utilize a 3rd party payment service. You may release an invoice and get paid in your home currency, and your customer will pay it in their local currency.

https://veem.grsm.io/veems 

 

2. Open a multi currency business account at TW as the virtual bank and utilize the bank feeds.

https://prf.hn/l/7gg1NWy

 

LeithG
LeithG
Level 2
June 23, 2020

hi leebrendalee

 

Revaluing is an important step of the accounting process so that your balance sheet indicates 'current business value'.  When you revalue Quickbooks updates the local currency information for foreign currency assets and liabilities based on the latest exchange rate information so you know how much you really owe or really have in your own local dollars.

 

How often you revalue is up to you.  If you have a ton of sales, cash, or liabilities in a currency other than your own, revaluing monthly might make sense.  If you only buy things or sell things in a foreign currency infrequently, and convert the foreign money (via a bank or exchange firm) to your home currency regularly, quarterly might make more sense.

L
leebrendaleeAuthor
June 23, 2020

Thanks for all the help!  Yes its 100% USD on that particular account (Sales) -so yes we will continue to revalue each month!

 

THANKS TO ALL.

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