Exchange adjustment

Artikel
09/29/2023

On the reporting date, the Central Bank of Russia's exchange rate must be used to revalue the cash balance on a foreign currency bank account so that it correctly represents the cash balance value in the accounting currency. The exchange rate difference from the revaluation of the currency bank account is the difference between the value, in the accounting currency, of cash in the bank account on the date of the payment (or on the reporting date of the previous reporting period) and the value, in the accounting currency, of the cash in the bank account on the reporting date.

Accounting of exchange rate differences

For accounting purposes, exchange rate differences are typically recorded as other income and expenses in the ledger account, such as ledger account 91 - Other income and expenses. For the purpose of income tax accounting, exchange rate differences are considered non-operational income and expenses. The exchange rate difference on the currency bank account can be either positive (when the currency exchange rate increases) or negative (when the currency exchange rate decreases). The following table shows examples of ledger transactions for positive and negative exchange rate differences.

Ledger transaction	Description
Debit 91 (unrealized loss) Credit 52 (currency bank accounts)	Negative exchange rate difference
Debit 52 (currency bank accounts) Credit 91 (unrealized gain)	Positive exchange rate difference

Setup

Set up ledger accounts for currency bank account revaluation

Go to General ledger > Currencies > Currency parameters.
On the left side of the Currency revaluation accounts page, in the Legal entities field, select a company.
Select the transaction currency, and then select Edit.
Set the Activate parameters option to Yes.
On the General FastTab, in the grid, in the Posting field, select Unrealized gain, and then, in the Main account field, select the ledger account to post the exchange rate gain to.
In the Posting field, select Unrealized loss, and then, in the Main account field, select the ledger account to post exchange rate loss to.
In the Income code field, select the income/expense code for tax accounting purposes that corresponds to the exchange rate gain.
In the Expense code field, select the income/expense code for tax accounting purchases that corresponds to the exchange rate loss.
Select Save.

Set up a number sequence

Go to Cash and bank management > Setup > Cash and bank management parameters.
On the Number sequences tab, in the Number sequence code field, select a number sequence code for the Bank – Exchange adjustment reference.

Calculate the exchange rate difference for a bank account

To do revaluation on the reporting date, use the Foreign currency revaluation page.

Go to Cash and bank management > Periodic tasks > Foreign currency revaluation – Bank.
On the Foreign currency revaluation page, in the On date field, select the revaluation date.
In the From currency and To currency fields, define the range of currency codes that should be revalued.
Select Filter to set up additional criteria for filtering. For example, select a specific currency bank account to revalue.
Select OK. The exchange difference for the selected date is calculated. You receive a message that indicates the date and amount of the exchange rate transaction.

View exchange adjustment transactions

You can review the posted exchange adjustment transactions on the Bank transactions page.

Go to Cash and bank management > Bank accounts > Bank accounts.
Select the bank account, and then select Transactions.
On the Bank transactions page, review the transactions that were posted because of the revaluation. The Ledger transaction type field for these transactions is set to Foreign currency revaluation.

Note

If the Ledger transaction type column isn't visible, right-click anywhere in the grid row that shows the column names, select Add columns, select Ledger transaction type and then select Insert.