QuickBooks Online Multi-Currency How-to Guide

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Dennis Benson
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1 QuickBooks Online Multi-Currency How-to Guide Let s commence looking at the Multi-Currency feature: First up when you open your brand new QuickBooks Online file, multi-currency is off by default Let s turn this on Gear/Company preference > Company settings > Company > Currency > tick on Multicurrency Once this is feature is turned on it cannot be turned off. How to add a new Currency Gear/Company preference > Company settings > Company > Currency > Manage Currencies > Add New From the Add new currency window filter down until you reach your currency & choose

> tick on Multicurrency Once this is feature is turned on it cannot be turned off.

As you start transacting in QuickBooks Online in any of the foreign currencies you will notice that automatically QuickBooks Online sets up an account named Exchange Gain or Loss to record the

2 As you start transacting in QuickBooks Online in any of the foreign currencies you will notice that automatically QuickBooks Online sets up an account named Exchange Gain or Loss to record the unrealised foreign exchange-related gains and losses this you will see in your Profit & Loss. You will see a foreign currency Accounts Payable or Accounts Receivable account in your Balance Sheet, so in doing this you know you can be confident in seeing the correct currency adjustment NO MANUAL ADJUSTMENT REQUIRED! Sales: Quotes & Invoices Quoting to an overseas customer in a foreign currency is pretty easy as well, you can direct your quote to customer, when your customer accepts you need to turn this into an Invoice, or if you don t need to quote you go straight to Invoicing the overseas customer To enter your Quote or Invoice for example USD Global Create > Customers > Quote

You will see a foreign currency Accounts Payable or Accounts Receivable account in your Balance Sheet, so in doing this you know you can be confident in seeing the correct currency adjustment NO

3 1. Choose your customer name **hint when setting up i.e. USD client I always add USD next to surname or Business name making it easier to choose correct customer 2. This rate is indicative as of the 03/06/15 USD to AUD rate **this is automatically populated once the date is entered from QuickBooks Online NO MANUAL ENTERING REQUIRED (if you need to change for any reason you can just enter in exchange rate field) 3. Quote date is date of currency exchange rate 4. GST FRE Exports if overseas Sales transaction 5. USD amount $ And also you will note on the same window we have the AUD amount $ > Save & send Once you client approves the quote next step is to turn this into an invoice 1. Select > Customer left hand side navigation bar click on the Money Bar > QUOTE (1) This will bring up all customers with quotes 2. Choose your client > Start Invoice (2)

reason you can just enter in exchange rate field) 3. Quote date is date of currency exchange rate 4. GST FRE Exports if overseas Sales transaction 5. USD amount $1000 6.

4 On the right hand side drawer > click on the Add button this will add this Quote to the Invoice And save and send **Note the USD exchange rate the Invoice date 03/06/15 and the AUD amount $

save and send **Note the USD exchange rate 1.

5 So now when viewing your Balance Sheet and clicking on the Accounts Receivables USD amount you will see your AUD amount not the USD amount

You will also see this invoice in AUD in your Accounts Receivables Ageing summary Report So you ve sent of the invoice to your client then Jemima Smith sends the USD $1000 payment and you apply this

6 You will also see this invoice in AUD in your Accounts Receivables Ageing summary Report So you ve sent of the invoice to your client then Jemima Smith sends the USD $1000 payment and you apply this to your invoice. But, we have two scenarios that could possibly happen: 1. First scenario: The same exchange rate has been used as the Wall Street on Demand rate that is used in QuickBooks Online, but, the date you receive this payment and the currency exchange rate is a different amount , the amount you receive is in AUD $ so short of the AUD $ that was owed on the original invoice dated , having a difference of $7.68 (this will go to the Exchange Gain or Loss accountsee below)

First scenario: The same exchange rate has been used as the Wall Street on Demand rate that is used in QuickBooks Online, but, the date you receive this payment 10.06.

7 2. Second scenario: A different rate was used by their bank and the receiving money is not AUD $ , but what was received in your bank was AUD $ In this instance what needs to be done is to enter in the different exchange rate to match to the amount received at bank, if this is not done, the incorrect amount will go to your bank account in QuickBooks Online and this will not be able to be reconciled correctly. Pretty easy step all you do is divide the AUD amount received in bank by the USD amount received so i.e. AUD$ / USD$1000 = (**Note: you may have bank charges to take into consideration in your AUD amount) 1. Enter into exchange rate field 2. Choose Only for this transaction (unless you do want to choose for all tranx for that date) 3. Click on OK Once Rate has been changed the AUD amount changes to amount you have received in bank. ** Note you will also have an Exchange gain or loss from original AUD amount

QuickBooks Online and this will not be able to be reconciled correctly. Pretty easy step all you do is divide the AUD amount received in bank by the USD amount received so i.e. AUD$1265.

8 The Invoice has been paid in full, this no longer will show up on your Accounts Receivables report see below because the full amount has been paid USD $1000. At this stage you may want to view the unrealised gain/loss amount based on the foreign balance differences, if there are quite a few of these transactions you may notice a larger difference. To view this you have a few different options the quickest way is to view your Profit & Loss Report, so clearly you can see that our Exchange Gain or Loss account we have a loss of $7.68 with this just one transaction

At this stage you may want to view the unrealised gain/loss amount based on the foreign balance differences, if there are quite a few of

9 Another report you can view Reports > All Reports > Business Overview > Realised Exchange Gains & Losses Purchases: Purchase Orders & Bills When ordering from overseas you can set up a PO first then turn this into a Bill, or if you receive the bill from your supplier overseas you go straight to entering this into a bill In this screen shot, if you need to set up a new Supplier (this same procedure will be the same when setting up a new customer) To add a new supplier > click on Supplier left hand side navigation bar Click on New Supplier (1) This brings up this window for Supplier Information Enter in company name (2) ** hint I add USD after the name so I know I have a USD supplier when I choose the supplier name I choose I pay this supplier with (3) click on the up/down carrot and choose your currency in this instance USD and Save (4)

procedure will be the same when setting up a new customer) To add a new supplier > click on Supplier left hand side navigation bar Click on New Supplier (1) This brings up this window for Supplier

Scroll to your list of Suppliers choose your supplier and right hand side hit the down carrot (1) and choose Create Purchase Order From here you can follow the normal procedure to create a Purchase

10 Scroll to your list of Suppliers choose your supplier and right hand side hit the down carrot (1) and choose Create Purchase Order From here you can follow the normal procedure to create a Purchase Order then turn into a bill for this Overseas supplier and again when making payment against this bill, because in most likely circumstances the rate will differ as you will be paying on a different day and foreign currency will be different you will again have an Exchange Gain or Loss. You can view same reports as above Sales to check your Loss or Gain. Revaluation of foreign currency debtors and creditors If you have any foreign currency debtors or creditors at year end you will want to make sure you reflect the exchange rates at the end of financial year. Gear/Company preferences > Company Settings > Currency > Manage Currencies

day and foreign currency will be different you will again have an Exchange Gain or Loss. You can view same reports as above Sales to check your Loss or Gain.

Click on the drop-down list of the USD currency and select Home Currency Adjustment At this point you change the date to the 30.06.

11 Click on the drop-down list of the USD currency and select Home Currency Adjustment At this point you change the date to the (1) this will automatically change your USD rate (2) click on Revalue (3)then any customer that has an outstanding USD amount will reflect in this area and magically calculates for you the Revalued Amount at this new rate and also the Exchange Gain /Loss Click on Save (4), which will then system generate a journal for you behind the scenes for the adjustment required for You can then reverse out this journal as at 1.07 as all we are doing is adjusting for year-end financials or if you prefer allow your accountant to process this part So in summarising the Multi-Currency feature You can see that the Multi-currency Tracking feature is one of the most powerful and easy to use and easy to understand features in QuickBooks online. All the hard work behind the scenes with having to source correct exchange rates, from different sources i.e. bank websites for historical rates, and being able to work out your true Exchange Gain or Loss has been taken on by QuickBooks online which is what I call A Seriously Easy way to manage your business finances! Lauretta Finis is the owner of Quick Bizness Bookkeeping Solutions (QBBS) and Bookkeeping your Bizzy Bizness (BYBB). Lauretta is also a QuickBooks Online Expert, a QuickBooks Online Certified Pro-Advisor, a member of the Trainer/Writer Network for Intuit Australia, a Fellow

Revalued Amount at this new rate and also the Exchange Gain /Loss Click on Save (4), which will then system generate a journal for you behind the scenes for the adjustment required for 30.

12 member of the Institute of Certified Bookkeepers (ICB), a Registered BAS Agent and her passion is thinking outside of the square and delivering solutions. And her King Charles Cavalier Buddy!

Setting up/using Multi Currency in QuickBooks

Setting up/using Multi Currency in QuickBooks The multi currency feature in Quick Books allows you to deal in currencies other than the Australia dollar. This includes Selling goods and /or services and