A caveat. John Ralls wrote ' ... If you need that you’ll have to turn off trading accounts in File>Properties and manage the trading accounts and splits manually.'
It seems I needed to do this too, as when I enter a purchase in euros into a euro account that is paid for with GBP, it alters all the previous amounts input in the reports. For example: purchase cost €100 paid for from a GBP account, the dialogue comes up and amounts input, so €100 = £90. Reports show €100/£90 - correct. Input another amount €100 = £95. Report shows €100/£95, as it should, but it also shows the previous transaction as €100/£95 instead of €100/£90 - incorrect. So this was the answer to that problem (hooray). However, I turned off trading as per instructions and later found the trial balance was out by a considerable amount, but I didn't connect the two at the time and it was only when I went looking for the reason that I found that all the €/£ transactions had the same amount €100/£100 rather than say, €100/£90. I have been going through the transactions correcting this and the trial balance is approaching balance. I just thought I would mention that. On Thu, 13 Feb 2025 at 17:38, John Ralls <jra...@ceridwen.us> wrote: > > > > On Feb 13, 2025, at 01:19, Bo Buckley <topherbuck...@gmail.com> wrote: > > > > In the foreign currency docs: > > https://gnucash.org/docs/v5/C/gnucash-guide/currency_trading_accts.html > > > > The Trading and CURRENCY placeholder accounts now indicate a modest > >> realized loss of 0.82 USD on the currency transactions. > > > > > > it appears to explain that the Trading top-most account balance > represents > > a loss if positive or a gain if negative. I only have a single > transaction > > so far that involves converting USD to JPY for a transfer. See attached > for > > the transaction. The Trading account already shows a balance of 247.38 > USD. > > How does this make sense? I didn't lose money on the transfer (other than > > the fee). It appears this balance is calculated based on the most recent > > Price Database entry for the currency (i.e. JPY at 0.0066 for > 02/09/2025). : > > 4,964.32 - (714,688* 0.0066) = 247.38. > > > > It seems to be interpreting a currency exchange from 1/9/2024 as a loss > > even though at the time of the trade it was not a loss. How am I to > > interpret this and what is this Trading Balance used for elsewhere? I > don't > > want it unintentionally affecting some other report calculations. > > > > For the sake of clarification, lets compare this behavior to stock > trading. > > USD and JPY are two commodities, just like USD and GOOG. For my example > > transfer from USD to JPY, the Trading Account balance loss seems to be > > similar to an unrealized loss if I interpret the transfer transaction as > > buying JPY from USD with the intent to someday convert back to USD. This > is > > similar to buying GOOG from USD and if GOOG dropped in values since > buying. > > But why is it not interpreted the opposite way, i.e. I sold USD to get > back > > JPY (or I sold GOOG to get back JPY for the stock analogy)? I want to > make > > sure GNUcash is not unknowingly treating the correct transactions as > > taxable events and not the opposite. I.e. for Japanese tax reporting the > > transfer would represent a taxable event as I "sold USD". The opposite > > would be true for US tax reporting no? I want to make sure I understand > the > > implications of this balance. > > Bo, > > The Accounts page Total column does use the most recent price database > entry to value each commodity that isn’t the book currency and that will > make the trading accounts reflect an unrealized gain or loss. > > US GAAP and IAS require all foreign currency transactions to be valued at > the time of the transaction in the book currency, and doing so inevitably > creates trading gains an losses that must be accounted for to keep the > books in balance. If the net gains aren’t taxable then you can book them to > a separate non-taxable income account. Keep in mind that GnuCash has no way > of helping you catch mistakes where you book a capital gain or loss to the > wrong income ro expense account: It can only verify that the accounting > equation balances for the whole book. GnuCash also can’t automatically > handle multiple trading accounts per commodity. If you need that you’ll > have to turn off trading accounts in File>Properties and manage the trading > accounts and splits manually. > > Regards, > John Ralls > _______________________________________________ > gnucash-user mailing list > gnucash-user@gnucash.org > To update your subscription preferences or to unsubscribe: > https://lists.gnucash.org/mailman/listinfo/gnucash-user > ----- > Please remember to CC this list on all your replies. > You can do this by using Reply-To-List or Reply-All. > _______________________________________________ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user ----- Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
