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zoe478
Level 1

Recording transactions received at foreign bank

I have a client with a German bank account. Invoices are created in euros and paid to the German bank in euros. I need to know how to put these transactions in Quickbooks Enterprise Desktop. The money will stay in the German bank account until the client decides to transfer funds to our US bank account. I have spent quite a bit of time researching this but everything I find seems to assume that the money will be deposited into the US bank account.

Thanks for any help.

3 Comments 3
RoseJillB
QuickBooks Team

Recording transactions received at foreign bank

Hi there, @zoe478.

 

I can help you with entering your foreign transaction in QuickBooks Desktop (QBDT).

 

You're right that QuickBooks records the payment made with the home currency or the bank account that matches the invoice. In your case, we can enter the invoice in euros and receive its payments. 

 

Before we start, let's make sure to turn on the multi-currency setting of your company file to keep track of transactions in foreign currency. Here's how:

 

  1. Click the Edit menu, and select Preferences.
  2. Go to the Multiple Currencies tab. Then, navigate to the Company Preferences tab.
  3. Select Yes, I use more than one currency.
  4. From the drop-down, select your home currency.

 

After that, add your foreign currency customer by following the steps below:

 

  1. Go to the Customers menu, and select Customer Center.
  2. From there, select the New Customer:job drop-down, then choose New Customer.
  3. Assign a Customer Name and Currency into Euro.
  4. Then, click OK.

 

To continue, add an account for your Euro transactions to keep track of them:

 

  1. Go to the Lists menu, and select Chart of Accounts.
  2. From there, right-click anywhere and select New.
  3. Choose the appropriate account Type and assign a name.
  4. Select Save & Close.

 

Proceed to Step 4: Update your exchange rates to add the exchange rates by referring to this article: Set up and use Multicurrency.

 

Since we're done setting up your company file to manage multi-currencies and creating accounts for it, we can proceed to creating the invoice and receive its payments. Here's how:

 

  1. Go to the Customers menu and select Create Invoices.
  2. Select your Euro customer from the Customer:Job dropdown.
  3. Enter the necessary details that your invoice contains to complete.
  4. Tap Save & Close.

 

To start recording the invoice payment, let's make alterations to your payment settings first to directly deposit the amount to your Euro account:

 

  1. Click the Edit menu, and select Preferences.
  2. Go to the Payments tab and navigate to the Company Preferences tab.
  3. Uncheck the Use the Undeposited Funds as a default deposit to account option.
  4. Tap OK.

 

Let's begin receiving the payment to keep your records accurate by visiting this article and referring to Enter a payment from a customer section: Record an invoice payment.

 

Since the transactions coming in are in euros, we can create Transfer Funds to move the money from your Euro account to the US account once your client decides to transfer it. Here's how:

 

  1. Go to the Banking menu and select Transfer Funds.
  2. From the Transfer Funds From section, select your Euro bank account.
  3. In the Transfer Funds To, select your US bank account.
  4. Choose the Transfer Currency and enter the Transfer Amount.
  5. After that, click Save & Close.

 

Moreover, you can consult your accountant for further guidelines in recording complex transactions as they have a broader knowledge of recording and managing your accounting transactions.

 

Additionally, I’ve added some resources you can look into to manage your transactions as well as your books:

 

 

I’m always here whenever you need my help. You can tap the reply button or post your concerns here.

zoe478
Level 1

Recording transactions received at foreign bank

I understand everything that you said but my question now revolves around the fact that the transactions in the German bank are in euros but everything else is in USD. So, how do I get the German bank transactions converted to USD. I don't expct my client to transfer funds unless absolutely necessary - so maybe once a year.

 

I need a way to convert those euro sales to USD as I will need to report them to the WA State Department of Revenue. Granted they will be a deduction but I still need to include those figure sin the Gross Sales.

 

Thanks again.

RCV
QuickBooks Team
QuickBooks Team

Recording transactions received at foreign bank

Thanks for coming back. Let me share some insights on how Multi-currency works in QuickBooks Desktop, zoe478.

 

If you are trying to get the German bank transactions converted to USD, then, we'll need to add an account in your Chart of Accounts for the foreign bank account. Just follow the steps provided by my colleague above. This way, you can transfer funds and download the updated exchange rates.

 

One of the reasons why we transfer funds from German bank to your US account is to zero out the balance in your USD account. Please be sure to choose the US Dollar as the transfer currency. Then, enter the USD amount and the exchange rate at that time. 

 

On your second question, reports in QuickBooks Desktop will always reflect the home currency regardless of the currency used in the transactions. The Home currency will be calculated by default. Also, amounts on sales and purchase transactions are in the customer's or vendor's currency, and the home currency equivalent is listed for the transaction total.

 

If there's a discrepancy, we can enter a home currency adjustment to have the correct Euro sales to report to the WA State Department of Revenue, follow the steps below: 

 

  1. Go to the Company menu.
  2. Click Manage Currency, and then click Home Currency Adjustment.
  3. Select the currency you'd like to enter the adjustment for. You can make adjustments for only one currency at a time.
  4. If necessary, update the currency's exchange rate. QuickBooks uses this rate to recalculate your home currency balances. By default, QuickBooks uses the latest exchange rate listed in the currency list.
  5. Click the Calculate Adjustment button. QuickBooks displays the balances you have for accounts in the selected currency.
  6. Tap the checkmark column to select the accounts to make adjustments for and then save the transaction.

 

Additionally, this guide provides an overview of how to handle different currencies in QuickBooks Desktop: Set up and use Multicurrency. You may also find the below links helpful:

 

 

Let me know how this goes and leave a reply below if you need further assistance managing currency. I'm always here to help. Take care always. 

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