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irvined1
Level 1

If sales invoice is raised in euros but paid in pounds sterling, how do i clear balance outstanding due to conversion difference?

 
Solved
Best answer July 16, 2019

Accepted Solutions
JanyRoseB
QuickBooks Team

If sales invoice is raised in euros but paid in pounds sterling, how do i clear balance outstanding due to conversion difference?

Hi, @irvined1.

 

I can help provide some details on how to clear the outstanding balance due to the conversion difference in QuickBooks Online (QBO). 

 

If the invoice is in EUR and customer paid in GBP which causes an open balance to your invoice, you can create a journal entry with Credit (Debtors) and Debit (Exchange Gain & Loss) for the open balance. 

 

When processing journal entry, you may consult an accountant if you’re not familiar with the process and to ensure your books are accurate.

 

However, once the invoice is in EUR and customer paid in EUR under your GBP Bank, then you can create a receive payment transaction to your customer's invoice and "Deposit to" your GBP Bank.

 

This will get you on the right track. Feel free to leave a comment below if you have other questions about the invoice transactions. Have a good day ahead. 

 

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4 REPLIES 4
JanyRoseB
QuickBooks Team

If sales invoice is raised in euros but paid in pounds sterling, how do i clear balance outstanding due to conversion difference?

Hi, @irvined1.

 

I can help provide some details on how to clear the outstanding balance due to the conversion difference in QuickBooks Online (QBO). 

 

If the invoice is in EUR and customer paid in GBP which causes an open balance to your invoice, you can create a journal entry with Credit (Debtors) and Debit (Exchange Gain & Loss) for the open balance. 

 

When processing journal entry, you may consult an accountant if you’re not familiar with the process and to ensure your books are accurate.

 

However, once the invoice is in EUR and customer paid in EUR under your GBP Bank, then you can create a receive payment transaction to your customer's invoice and "Deposit to" your GBP Bank.

 

This will get you on the right track. Feel free to leave a comment below if you have other questions about the invoice transactions. Have a good day ahead. 

 

Sky8
Level 2

If sales invoice is raised in euros but paid in pounds sterling, how do i clear balance outstanding due to conversion difference?

I can see that the journal makes sense, but how do I get the customer's ledger back to zero?

ReymondO
QuickBooks Team

If sales invoice is raised in euros but paid in pounds sterling, how do i clear balance outstanding due to conversion difference?

Hi there, @Sky8.

 

You can remove the open balance on your customer's invoice by creating a journal entry as suggested by my colleague above. You'll have to make sure to use the correct accounts to ensure they affect your customer's balance. 

 

If you're not sure about this process, I'd recommend reaching out to your accountant. This way, we can ensure that your book is correct.

 

On the other hand, you can set up a new currency for the same customer. Just create another account for them and use that to record payments in their currency.  That way, you won't need to convert their payment or use a journal entry. Let me show you how:
 

  1. Turn on the multicurrency feature
  2. Go to Sales and select Customers.
  3. Click New customer and enter their details. You can use the same name with a slight difference for this customer.
  4. Choose their currency from the Currency dropdown list.
  5. Click Save

 

Once done, you can use this customer profile to record and receive invoice payments based on their own currency. 

 

I’m also attaching these articles for your overview and how Multicurrency works

 

Please let me know if you have any other concerns related to QuickBooks or handling your account. I'm always here ready to help. Have a good one.

Sky8
Level 2

If sales invoice is raised in euros but paid in pounds sterling, how do i clear balance outstanding due to conversion difference?

All sorted now - many thanks for all your help Smiley Happy

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