How to Adjust Base Currency?

Base Currency Adjustments

There is always a little amount of risk involved while transacting with customers dealing with foreign currencies. The risk is due to the fluctuation of exchange rates on a daily basis. Most of the times it is a profitable transaction, except for a few unlikely days of bad exchange rates.

In Zoho Books you can have an insight on the profit or loss incurred due to the change in exchange rates and also can apply the changes to open transactions.

Scenario,

How to Adjust Base Currency?

To adjust the base currency in Zoho Books, navigate to Accountant > Base Currency Adjustments and click on + Make an Adjustment button.

Base Currency Adjustments Base Currency Adjustments

The exchange rates used are just for the purpose of an example.

P.S: We recommend you to have an accountant or a bookkeeper to have the adjustments made according to the date.

Note: Open transactions are very much mandatory to make base currency adjustments.

Once the details are filled, you will be navigated to confirm the adjustment.

Confirm Adjustment

Fields Description
Account The account which is affected due to the change in exchange rates.
**Balance (FCY) In this case the FCY is in Euro (EUR).
The total amount present in FCY.
Balance (BCY) In this case the BCY is in USD. The total amount in BCY with the previous exchange rate.
Revalued Balance (BCY) The total amount in BCY after the new exchange rate is adjusted and revalued.
Gain or Loss (BCY) This column shows whether you have made profit due to the change or incurred a loss. An amount with a negative sign will depict the loss incurred.

*FCY: Foreign Currency ; BCY: Base Currency

If you wish to adjust the new exchange rate, check the box under the Select column and click on Make an Adjustment.

As soon as the adjustment is made, the particular account affected will be uploaded with the new values in the Reports section.

Business Overview

Fields Description
Profit and Loss Non Operative Income/Expense (Exchange Gain or Loss)
Balance Sheet Current Assets (Accounts Receivable)

Accountant

Fields Description
Account Transactions A entry with Base Currency Adjustment as type will be created.
Journal Report A new section will be created with the date and title as Base Currency Adjustment.
Trial Balance Assets (Accounts Receivable)

Currency

Fields Description
Realized Gain or Loss Transaction Type: Base Currency Adjustment

You can always delete the base currency adjustment you made by selecting the entry from the Base Currency Adjustment window and click on the Delete option.

Business Overview


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