Month End Re-evaluation process for Foreign Currency

JobBag can re-state any foreign currency balances in the Balance Sheet based on the foreign exchange rate applicable at the end of the period.

There is also a report that gives more clarity in the unrealised gains and losses that are posted to the GL by this new process.

Foreign currency balances will be restated where the system currency value of a foreign currency balance has changed from the time the transaction was entered into JobBag, or in the case of bank accounts, where the bank balance is in a foreign currency and needs to be restated in the system currency at the end of the period so that the consolidated financial statements, which are always in the system currency, are shown at their current system currency values.

The latest currency rates in JobBag are used to restate any foreign currency balance on balance sheet accounts where an unrealised gain/loss account has been nominated and automatically posts the entries to the general ledger.

This process will generate the entry for unrealized exchange gains/losses at month-end and the reversing entry as at the beginning of the following month.

Month-end revaluation process

1 Repeat the revaluation process as many times as required at month-end.

2 When the accounts are finalized, delete all the foreign exchange revaluation journals which were created for the month-end process.

3 Run a GL verification

4 And do a final foreign currency restatement

Month End Revaluation Process

Remember to download the foreign exchange rates for the month/period end.

Step 1: Run a GL Verification, found under the Ledger menu

Click on run

Step 2:

Navigate to: Ledger menu > Restate General Ledger

Step 3: Highlight the month to be processed and click on run

When the restatement is successful, the following notice appears

Step 4:  Check if you need to do another GL verification

Foreign Currency Restatement Report

Step 1: Reports > Financial Reports

Step 2: Select Foreign Currency Restatement from the drop down list

Step 3: Select period for revaluation

Step 4:  Example of Restatement Report

The information used to calculate the foreign currency gain as below:

The aged receivables has a total of USD6000.00 outstanding and in AUD the total outstanding is AUD$7,678.57.

The month end rate in the system is as below:

Foreign Currency Journal

Two sets of journal entries are created - one for the current month and a reversal entry for the following month

Journal for current month

Reversing journal for the next month