Hi,
Am 26.03.2019 um 17:36 schrieb James Walker:
> * Created a USD expenses account for the company ("Expenses:US Company
> USD")
This is totally unnecessary. You should only make a conversion on the
expense side once and this is to GBP. Any rate fluctuation occuring with
the payment should be solved with correcting income and expense account.
I’ve said time and time again, that in my view only assets and
liabilities should be in foreign currencies.
Using your example with the spot rates of the 25th to 27th provided by
the Bank of England and assuming payment on the same day and leaving out
the trading accounts I would proceed as follows:
Invoice 1:
By Expenses:US Company £10.91
to Liabilities:Current Liabilities:Trade Creditors USD $14.40
Invoice 2:
By Expenses:US Company £10.89
to Liabilities:Current Liabilities:Trade Creditors USD $14.40
Invoice 3:
By Expenses:US Company £10.92
to Liabilities:Current Liabilities:Trade Creditors USD $14.40
Payment 1:
By Liabilities:Current Liabilities:Trade Creditors USD $14.40
to Assets:Current Assets:Bank £10.61
to Income:Foreign Exchange Fluctuation £0.30
Payment 2:
By Liabilities:Current Liabilities:Trade Creditors USD $14.40
to Assets:Current Assets:Bank £10.87
to Income:Foreign Exchange Fluctuation £0.02
Payment 3:
By Liabilities:Current Liabilities:Trade Creditors USD $14.40
by Expense:Foreign Exchange Fluctuation £0.10
to Assets:Current Assets:Bank £11.02
Kind regards
Christian Kluge
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