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JonSWR
December 3, 2020
Question

Record USD investment at maturity, leaves exchange gain/loss?

  • December 3, 2020
  • 1 reply
  • 0 views

Hi,

 

I had, let's say, $100 USD in a term deposit in January, maturing November.  I create a journal entry for $100 as an asset and $100 as liability due to shareholder.

 

Upon maturity, some interest was deposited to my chequing account, OK.  But I want to remove the $100 asset and liability from my books because I took that $100 and returned it to shareholder.

 

But when I do a transfer, I get a remaining balance in CAD even thought the USD value is $0.  Every month, I revalued the currency, and because of that, every month there was a gain or loss on paper.  Since the exchange rate in November is different from all the revaluations and exchange rate on the original date of purchase, now I'm left with a balance in CAD, equal and opposite in both the asset and liability accounts.

 

Of course I can probably make a journal entry to clear both out, but isn't there a more elegant way to manage this?  It's annoying how QBO always reports everything in home currency even when I specifically hold USD that never needs to intermingle with CAD otherwise. 

 

What's the proper way to record this kind of transaction in QBO?  I don't think this an accounting problem, it's a software problem.

 

Thanks.

1 reply

Rebecca R
Rebecca R
December 3, 2020

Hello Jon,

Keeping an accurate record of your exchange gains and losses is a vital part of managing your international sales. QuickBooks Online's multicurrency feature allows you to do this with ease. I'd be happy to point you in the right direction.

Since handling foreign exchange investments can be a more complex accounting process, I recommend speaking with an accountant who is familiar with the QuickBooks Online program to get a better understanding of how to handle these transactions. You can invite an accountant to view your company by clicking the My Accountant tab and sending an invite via email. If you're not currently working with an accountant, you can click the Find a pro to help button to search for a QuickBooks-certified Pro Advisor in your area to consult with.

You can also check out the following Community articles for more information about working with Multicurrency:
 

As for reports only generating in your home currency, I can see how having reports generate in other currencies would be helpful, especially since the USD transactions aren't transferring to a CAD account. I recommend submitting your feedback regarding this to our software developers so that they can take this into consideration when preparing future updates to the program. Here's how you can submit feedback from within your QuickBooks Online company:
 

  1. Select the Gear icon at the top, then Feedback.
  2. Enter your comments or product suggestions then select Next.
  3. You'll be provided a list of suggested Help articles related to your comment. You can read through them or select Skip and send message.
  4. From the drop-down, choose the appropriate category, then select Send message.
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Have a good day!

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