Handling Exchange Losses & Gains in NEOSYS: Difference between revisions

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=== Handling Exchange Losses & Gains on payments from Clients ===
=== Handling Exchange Losses & Gains on payment to Supplier Invoices ===
Many a times, the foreign exchange rate fluctuates and hence there is a difference in the invoice currency amount issued or received as compared to the actual payment received or paid.
Many a times, the foreign exchange rate fluctuates and hence there is a difference in the invoice currency amount issued or received as compared to the actual payment received or paid.



Revision as of 14:21, 10 November 2008

Handling Exchange Losses & Gains on payments from Clients

Handling Exchange Losses & Gains on payment to Supplier Invoices

Many a times, the foreign exchange rate fluctuates and hence there is a difference in the invoice currency amount issued or received as compared to the actual payment received or paid.

Hence NEOSYS handles these differences and allots the amount to a Exchange Loss or Gain A/c.

Below is an example of a sale which has been done:

A client is invoiced for 100STG on 1/1/2007. On this date the exchange rate was 1 STG=7 AED

Exdi1.jpg


The client makes a payment for this invoice on 1/2/2007. However the exchange rate on this day has changed to 1 STG=7.5 AED. Hence there is a profit of 50 AED when we receive this payment. NEOSYS automatically notices this and does the following:

  1. Allocates the payment of 100STG (750AED) to the invoice in the client a/c
  2. Credits the 50AED from the allocation which is overallocated to the invoice
  3. Debits the Exchange Loss or Gain A/c (EXDI in this case)

Exdi2.jpg


The following are the ledger printouts of all the accounts which were involved in this transaction:

Exdi3.jpg

Exdi4.jpg