I'm here to share some insights about foreign exchange gains or loss, @tomegranate.
The amounts that you're seeing are unrealized forex gains or loss. It means that it has an increase/decrease in the value of assets, yet no cash has taken place. Some accountants call it as "Paper loss/gain."
These gains or losses are only realized after the transactions have been completed or when money has been collected or paid.
That is why it shows the effect of a home currency adjustment on Accounts Payable or Accounts Receivable as an unrealized gain or loss, and the effect on account types such as bank accounts as a realized foreign exchange gain or loss. Unrealized gains or losses are also not reflected in the general ledger or the trial balance.
I'm also adding this article for more FAQs about unrealized gains and losses: Frequently Asked Questions about Home Currency Adjustments.
Please let me know if you have other questions or concerns. We're always here to help. Have a great day, @tomegranate.
