Frequently asked questions about home currency adjustments

When you adjust the home currency, QuickBooks Online creates a journal entry. It shows no gain or loss for accounts receivable (A/R) or accounts payable (A/P). It also records the date you revalued a currency, the currency you revalued, and the exchange rate.

The journal entry's non-zero amount represents realized gains or losses. They’re from adjusted bank or credit card accounts. You can update the entry number and memo, but not the date, amounts, or exchange rate.

Reports use the exchange rate from these adjustments to calculate unrealized gains and losses.

Note: To change the date or exchange rate, delete the journal entry and run the currency revaluation again.

Unrealized foreign exchange gains or losses are profits or losses on paper, due to changes in exchange rates. They only become real after money has actually been collected or paid.

Home currency adjustments affect A/P or A/R as unrealized gains or losses, and bank accounts as realized foreign exchange gains or losses.

Note: Unrealized gains or losses aren't shown in the general ledger or trial balance. Check the transaction detail report for more information.

Here’s how you can track home currency adjustments on the Revalue history tab.

1. Sign in to your account.
2. Go to Settings , then select Company Settings.
3. Go to Advanced, then under Currency select Manage Currencies.
4. In the Action column, select the Edit currencies exchange ▼ dropdown. Then, select Revalue Currency.
5. On the Revalue page, select the Revalue History tab.

Note: The Revenue History tab lists past currency changes. It includes dates, exchange rates, and links to related journal entries.

The profit and loss, balance sheet, customer balance detail, vendor balance detail, and statement of cash flows reports show information on unrealized gains or losses. Revalue your foreign currencies before running reports to show correct unrealized gains or losses.

Tip: Customize the customer balance detail report and the vendor balance detail report to view unrealized gains or losses.

1. Sign in to your account.
2. Go to Reports, then select Reports.
3. Open the Customer Balance Detail or Vendor Balance Detail report.
4. Select Customize.
5. In the Customize report window select Rows/Columns, then select Change Columns.
6. Select the Unrealized Gain or Loss checkbox.
   
   Note: Select the Revalued Open Balance and Revalued Exchange Rate checkboxes for details
   
7. In the Aging ▼ dropdown, under Aging method, select the Report date.
8. Select Run report.

You can select an account's amount in  the profit and loss  report or balance sheet.  This opens the transaction report. If the account has open transactions and you've adjusted the home currency, the report will show the date and rate used to revalue the foreign currency, as well as other details.

Each open transaction shows the total unrealized gain or loss. This way, you can see the effects of home currency adjustments on each transaction.

Note: The profit and loss detail report shows $0.00 in exchange gain or loss. It provides exchange rates and revaluation dates that don't affect your books.

For accounts with foreign transactions, you'll see a row for previous unrealized gains or losses in the transaction report. The report shows past unrealized gains or losses. It then adjusts them to match the current amounts.

There's no need to reverse realized gains or losses across periods. The transaction report for foreign bank accounts doesn't include the previous gain or loss row.