Exchange Rate Variances

Reconciliation

The customer can get an exchange rate gain or loss if they reconcile two entries, usually an invoice, and a payment.

Transaction Currency Base Enterprise Remarks
Invoice Currency1 Base1 Enterprise1
Payment Currency1 Base2 Enterprise2
Exchange Rate Variance 0 Base1 - Base2 Enterprise3 = (Base1 - Base2) converted to Enterprise

Note: The amount in currency must be zero, and in instances where currency and enterprise are in the same currency.

Balancing Exchange Rate Variance 0 0 Enterprise1 - Enterprise2 - Enterprise3

Note: The amount in currency must be zero, and in instances where currency and enterprise are in the same currency.

Job Exchange Rate Variances

A job-related entry is posted both on the job and on the company. We typically use the job-specific exchange rates for all conversions. However, there are instances where we have to use both the company-specific exchange rate and the job-specific.

Example 1

A vendor invoice is created and posted using the company-specific exchange rate, and later allocated to a job using the job-specific exchange rate.

Example 2

An expense sheet is created. The employee expects to get the correct amount in their local currency, which most likely is the company-specific exchange rate. However, we must use the job-specific exchange rate for the job entry.

Transaction Currency Base Enterprise Remarks
Invoice/Expense Sheet Currency1 Base1 Enterprise1 Converted using company-specific exchange rate
Job Currency1 Base2 Enterprise2 Converted using job-specific exchange rate
Job Exchange Rate Variance 0 Base1 - Base2 Enterprise3 = (Base1 - Base2) converted to Enterprise Note: The amount in currency must be zero, and in instances where currency and enterprise are in the same currency.
Balancing Job Exchange Rate Variance 0 0 Enterprise1 - Enterprise2 - Enterprise3 Note: The amount in currency must be zero, and in instances where currency and enterprise are in the same currency.