How do I record forex transactions between accounts which are not in my home currency?

Good day, @RobertBarber,

The transactions you create or enter in a Multi-currency company will always hit the home currency. We use this information to help businesses get the most accurate information on financial reports during the Fiscal Year.

When you record multi-currency transactions in QuickBooks, it will take a few steps to do. You will need a wash account for this since the system only allows you to assign one currency at a time.

Let us firstncreate a deposit in the USD account to match with the one you received. Let's say you have a 1000 USD income from a client. See this:

To clear the 1000 USD balance in the USD account, use a wash account to account for the transfer. To create a clearing account, use these steps:

1. Go to the Accounting menu and select New.
2. Choose Cash and cash equivalents.
3. Pick Cash on Hand for the Detail Type.
4. Use USD United States Dollar for the currency, then hit Save and Close.
   

Once done, transfer the amount in the USD account to the clearing account. Here's how:

1. Go to the + New icon and select Transfer.
2. Choose the actual USD account you received the money from and the wash account.
3. Enter the amounts (1000USD).
4. Click Save and close.
   

Once you've zeroed out the USD account, create another deposit in the GBP account this time. Do this to increase the balance in the United Kingdom bank. Go to the + New icon again then choose Bank Deposit.

In addition, here's are a few articles you can read to learn more about recording Multi-currency transfers:

• How to Use Foreign Currency Transfers With Bank Feeds in QuickBooks Online
• Transfer funds from a bank to a credit card account
• Transfer funds between accounts

Let me know if you have additional questions about this. I'll be right here to help you anytime. Have a good one!

Hi Jen,

Thanks for this, however I'm a little confused. Perhaps if I explain my multicurrency basis you can be specific about the wash account?

My base currency is Botswana Pula (BWP). I receive payments from clients in USD/GBP/ZAR and sometimes EUR. 

Furthermore, to obtain BWP, I sell my bank hard forex (USD etc.) for BWP, so I need to not only record income from clients, but also inter account transfer e.g. USD to BWP.

Are you able to explain how I do this specific to my needs with BWP as my base currency?

Many thanks,

Rob

I appreciate the details a lot, @RobertBarber.

In addition to Jen_D's post, the wash account will help you transfer funds to different currencies or for money movement.

So when you Received payments, set the Deposit To field to the Wash Account that has the BWP since it's your home currency. Before saving the transaction, ensure to take note of the home currency amount displayed at the bottom right.

For example, you received a USD 1000 payment for the invoice, and this gives you BWP 11084.28.

Next, you'll have to transfer this BWP 11084.28 from the Wash Account to other currencies like the EUR account. Here's how:

1. Click + New and then select Transfer.
2. Under the Transfer Funds From column, select Wash Account from the drop-down arrow.
3. Under Transfer Funds To, select EUR account from the drop-down arrow.
4. Under the Currency column, select BWP from the drop-down arrow.
5. Under the Transfer amount column, type in 11084.28.
6. Under the Exchange rate, the exchange rate will automatically appear. You can manually change it anytime.

I've added links as your references with how to record or handle exchange rates in QBO:

• About exchange rates
• Receiving and making payment for a foreign invoice/bill with a foreign currency
• Transfer funds between accounts

You can also use this as a future reference on how to designate a foreign currency to your supplier and change its current currency to a different currency: Add a supplier with a foreign currency in QuickBooks Online.

Please tag me in your comment if you have other questions to add. I'll check on my notifications then. Take care!