Calculated Exchange Rate

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At any point in time, the current balance of a foreign currency bank account is shown in both the nominated foreign currency and the home currency.

 

The relationship (calculated exchange rate) between the two balances is not dictated by spot rate, or affected by revaluation sessions. It is a calculated exchange rate.

 

This rate shows as the exchange rate against the currency bank balance in the Revaluation Session.

 

hmtoggle_arrow1Explanation

 

hmtoggle_arrow1Example

 

Because the value (balance) of the foreign currency bank accounts is affected by currency rate changes, it is good practice to revalue that balance periodically. The Revaluation Session will include each current foreign currency bank account balance only.

 

Whereas unpaid transactions such as creditor purchases will be revalued against the very specific exchange rate they were recorded at, foreign currency bank accounts will be revalued against their current calculated exchange rate.

 

Info

Where a foreign currency bank balance goes below $0.00 balance, eg. the bank account is in overdraft, Jim2 will use the current spot exchange rate on that transaction.

 

Further information

Multicurrency Definitions

Creditor/Debtor Lists

Adjustments Up/Down

Entering Cheques/Deposits

Transferring Funds

Invoicing and Multicurrency

Bank Reconciliation