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Multicurrency bank accounts change of rates - Printable Version

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Multicurrency bank accounts change of rates - PakRicard - 05-22-2012

Hi all:

Imagine we have a company with functional currency IDR and one bank account in USD.

On day 1 rate USDIDR was 9.000 (1 USD = 9,000 IDR)
We funded a bank account in USD with 9.000.000 IDR, so we have got 1.000 USD.

Then the time goes, and on day X the rate is 1 USD = 8,500 IDR. So we change the rate at currencies.php

Nothing changed except the rate, so now we still have a bank account with 1.000 USD.

Its value at the balance sheet still is 9.000.000, but the real value should be 8.500.000 in banks and -500.000 as P/L somewhere.

All this to say I think we need a function to recalculate the value of foreign currency bank accounts every time the rate changes...


RE: Multicurrency bank accounts change of rates - phil - 05-27-2012

Ricard,

There is a function already - in the bank reconciliation to revalue a foreign currency account based on current rates - and write off/on the unrealised exchange loss/gain.


RE: Multicurrency bank accounts change of rates - PakRicard - 05-28-2012

Hi Phil:

Yes, that's the function we use now, but it is manual and prone to error or easy to be forgotten. I was thinking on a automatic reevaluation of the value each time the rate changes. I think it should not be difficult, I will try to get some pseudocode for it, before messing up all the accounting side ;-)