Thus let’s figure out on how to “reconcile foreign currency bank account in QuickBooks“. As already said multiple times that QuickBooks is feature enriched. No matter how small or big your company is: if you have multiple currencies to deal with then QuickBooks is the solution for you. It can, not only track but manage; keep a record of your every entry that you have done internationally. Thus maintaining books becomes a lot easier with QuickBooks as recording is easy, so is reconciling.
Reconcile Foreign Currency in QuickBooks
As QuickBooks is fully capable of handling your foreign transactions but in-order to use it you will need to activate the multi-currency feature. Enabling the said functionality will allow you to choose a currency of your choice. Thus, you will be able to choose a vendor, choose a currency against him and pass an entry in the currency other than your regular currency.
How to Reconcile Foreign Currency Bank Account in QuickBooks?
In-order to reconcile foreign currency bank account you should have an entry within the program. If your foreign currency feature is already enabled and you have an entry to be reconciled then follow the steps to follow the reconciliation process:
- Launch QuickBooks and navigate to your QuickBooks company file.
- From the top navigation bar, click on the Companies tab.
- This will open up a drop-down menu. From the list of options provided, click on the “Journal entries” tab.
- You will now see the currencies tab. Choose your home currency U.S. dollar from the predefined list.
- Enter the date for which you want to pass an entry.
- Now check mark the box alongside “Home currency adjustments” tab. The moment you checkmark the box, you will see a dialogue box appearing. Click ok to the tab and move on. This will now activate your home currency adjustments and you will be ready to reconcile.
- QuickBooks doesn’t allow you to reconcile in foreign currency. The only currency you can adjust is your home currency. Thus if you have selected USD as your home currency then you will see 1 USD will be put equal to 1 foreign currency which cannot be changed. Thus we will now alter USD to pass a reconciliation entry.
- To pass the journal entry:
- First line: Choose the account that needs to be reconciled and enter the amount that shows unbalanced figure. If the unbalanced figure is positive then enter the amount as debt. But if the differencing figure is negative then enter the same figure as Credit.
- Second line: Now enter the exchange gain or loss account and enter the opposite balancing figure.
- Your balances should now show a zero figure and your differing account should now be sorted. At this point save your entry and click close to exit the window.
Foreign Currency Opening Balance Now Showing
People also often find issues with the opening balance of foreign currency. They often complain that their opening balances are not showing. If this is the case with you then follow the steps below. Your foreign balances can be easily viewed by:
- Clicking on the settings tab on the top right panel.
- Choosing the Chart of accounts tab and then finally selecting accounts history option. This will show you if you have any balances kept in your foreign currency account.
How to Record Opening Balance of Foreign Currency:
If you want to enter an opening balance of your foreign currency and if for some reason you are not able to do that then:
- Choose the settings tab again.
- From the bank deposits tab, choose the name of the bank you want to record an entry in.
- Now choose the currency you and click on the add deposits tab.
- Choose an account and enter an opening figure.
- Click Save when done and your opening balance should start to reflect in your foreign currency account.
Managing foreign currency in QuickBooks is a little tedious process than a regular currency as one mistake will create a lot of delays and errors. Thus tread very carefully as you go.
If your query “How to reconcile foreign currency bank account in QuickBooks” has been sorted then great, for anything else call us. Our QuickBooks ProAdvisor are proficient enough to deal with any query you might have. Thus wait no longer and give us a call now.
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