Work with foreign currency

Applies to:     Office Accounting Professional

Enabling foreign currencies in Office Accounting Professional adds Foreign Currency menu options on the Company menu.

work with foreign currency

Foreign Currency menu options

Currency list

The list of currencies shows all the foreign currencies that are set up in Office Accounting Professional.

work with foreign currency

List of currencies

You can add and edit currencies as well as remove unused currencies. Currencies that have been referenced by a customer, supplier, bank account or transaction cannot be removed (but they can be made Inactive).

Important: Office Accounting uses Pounds Sterling (GBP) as the base currency. You cannot change the base currency. You can use foreign currencies for supplier accounts, customer accounts and some bank accounts; however, most account types will only use the base currency.

The Add or Edit Currency dialog box can be opened by selecting a currency and clicking Edit.

work with foreign currency

Add or Edit Currency dialog box

With Microsoft Office Accounting 2008, you can define a currency symbol and currency code for each currency as well as maintain historical exchange rates. The Exchange Gain and Exchange Loss accounts are the nominal accounts where gains and losses for the individual currency are posted. By default, Office Accounting 2008 sets up one account for all gains and one account for all losses.

Tip: The Windows Vista and Windows XP operating systems have a Character Map tool (click Start, point to All Programs, point to Accessories, point to System Tools and then click Character Map) that can be used for looking up symbols for foreign currencies, such as ¥.

Exchange rates

Accounting 2008 keeps track of historical exchange rates for each currency. This helps if you are recording transactions from the past.

You can update the exchange rates for all the active foreign currencies by selecting Update Exchange Rate on the Foreign Currency menu.

work with foreign currency

Exchange Rate Update dialog box

The advantage of this dialog box is that you can set the exchange rates for all active currencies at one time without having to use the Add or Edit Currency dialog box for each currency.

Foreign exchange rates are quoted in foreign units per pounds sterling (GBP). In the preceding example, the exchange rate is set for euros and U.S., Australian and Canadian dollars.

When you create documents in foreign currency, Accounting 2008 automatically uses the last effective exchange rate on or before the document date. However, you can change the exchange rate on a document if the rate is invalid.

Tip: You can save the URL of your favourite online source for exchange rates in the Currency web page address field and use the browse button to get to the exchange rate Web sites for quick reference when you are updating the exchange rates.

Master records with foreign currency

Office Accounting Professional supports customers, suppliers, bank accounts and credit card accounts in foreign currency.

work with foreign currency

Foreign currency customer

The following applies to master records with foreign currency:

  • When foreign currencies are enabled, you select a currency for the customer, supplier, bank account or credit card account.

  • A master record can have only one currency.

  • The default currency is pounds sterling (GBP).

  • Balances of foreign currency master records are displayed in foreign currency as well as in pounds sterling (GBP).

  • The title of the form displays the currency code (in the example, CAD) in parentheses to show that it is a foreign currency record.

  • All documents must be in the customer's, supplier's or bank account's currency.

  • After a document is created, the currency of the master record cannot be changed.

  • For customers and suppliers, the financial summary and financial history will be displayed in both foreign currency and pounds sterling (GBP).

work with foreign currency

Financial summary for a foreign currency customer

Lists with foreign currency

After you enable foreign currencies, all lists in Office Accounting Professional display the currency of the transaction and the amount in foreign currency as well as the corresponding amount in pounds sterling (GBP).

work with foreign currency

Quote List with foreign currencies enabled

Displaying the currency as well as the amounts in both foreign currency and pounds sterling (GBP) makes it easier to sort the lists to find what you are looking for.

Tip:  Because Office Accounting Professional adds two extra columns, currency and amount in pounds sterling (GBP), to all the lists, when foreign currencies are enabled, you may want to remove or rearrange some columns to keep the lists simple.

Documents with foreign currency

After you set up foreign currency customers, suppliers, bank accounts and credit card accounts, you can create documents with transactions in foreign currency.

work with foreign currency

Sample foreign currency invoice

The following procedure applies to documents with foreign currency.

  1. Open the document type you want to create and select the foreign currency customer or supplier.

    The currency exchange rate is based on the date of the documents, but the rate may be changed.

  2. Select the products and services for the customer or supplier. The corresponding unit price is calculated based on the exchange rate.

  3. Accounting 2008 calculates the total in foreign currency as well as in pounds sterling (GBP) based on the exchange rate.

  4. To save the transaction, click Save and Close.

  5. The document is posted in foreign currency as well as in pounds sterling (GBP). This way your financial records always appear in pounds sterling (GBP) even though some of your transactions are in foreign currency.

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