Bank statement accounting for multiple currencies


System currency is $CAD. Sale is in $USD. Payment is made in $USD by check on date1 and entered in the system using a spot rate on that day. The payment is allocated against the invoice.

On date2, the payment is deposited in a $CAD account at a different rate.

The bank reconciliation creates a few problems.

Problem 1. The statement "create from" uses the bank currency ($CAD) evaluated on the date1 rather than the conversion rate at date2. The FACTS end up in the system currency rather than the source currency.

Problem 2. The manual entry does not set the statement line currency to the source currency. It can be set to $USD but the statement difference assumes all statement amounts are in the bank account currency. This creates an error in the statement difference and the ending bank balance.

Problem 3. The accounting facts created in the statement do not adjust the bank in-transit account for the realized gain/loss on the transaction. The error is the difference in exchange rate between date1 and date2.

See the attached image of the account info for the set of transactions. Note the checking in-transfer account transactions which would leave a balance in that account following the bank statement/reconciliation.

The FACTs created for the statement line should check the FACTs of the payments and ensure the transit accounts balance, with appropriate entries for realized gain on the transaction.





Michael McKay
July 12, 2014, 2:15 PM

The software should enforce the payment currency then. Leave it for post 380. Low priority.

July 11, 2014, 1:33 AM

dont create payments in a bank other than in the currency of the bank account... this is what the bank does and there is a reason for it!


Michael McKay


Michael McKay