Account Usage
If necessary, losses and gains on Exchange Rate conversions can be posted to separate loss and gain Accounts. Different loss and gain Accounts can also be maintained for Sales and Purchase Ledger transactions. Alternatively, if your requirement is for a simplified Accounts structure, the same Account can be used in each case.
First, ensure that the Account(s) to be used have been added to the Chart of Accounts. Then, Hansa needs to be informed which Account is to be used in each circumstance. This is done using card 2 of the Account Usage S/L and P/L settings in the Sales and Purchase Ledgers respectively.
The Accounts on this screen which are relevant to Multi-Currency users are now described. Except where stated, separate Accounts can be defined for use in a particular circumstance depending on whether the originating transaction comes from the Sales or the Purchase Ledger.
Write Offs, Rate Round Off, EMU Rate Round Off, EMU Rate Write Off
These Accounts are used in the situation where an Invoice is to be treated as fully paid if the amount received is slightly different to that outstanding, providing that difference is within an allowable margin. The difference is posted to one of these Accounts on the following basis:
- Write Offs
- if the Received Currency is the same as the Invoice Currency, and the Received Currency is not a member of the EMU;
- Rate Round Off
- if the Received Currency is different to the Invoice Currency, and it is not a member of the EMU;
- EMU Rate Round Off
- if the Received Currency is different to the Invoice Currency, and it is a member of the EMU;
- EMU Rate Write Off
- if the Received Currency is the same as the Invoice Currency, and the Received Currency is a member of the EMU.
Please refer to the pages describing the 'EMU' and 'Round Off' cards of the Currency screen for more details of this feature.
Note that in the special case where the difference is caused by a change in Exchange Rate, it will not be posted to one of these Accounts, but to the Rate Gain or Loss Account (described below).
In the case of Write Offs Account in the Account Usage S/L setting only, this Account is also used for bad debts written off by the 'New Write-off' Operations menu function of the Receipt and by the 'Write off Invoices' Maintenance function.
Base Currency Round Off
Under the Dual-Base system, all Nominal Ledger Transactions should be expressable, and should balance, in both Base Currencies. The Account entered here will be used for postings to ensure that this is the case. Usually, it will only be used for Base Currency 2 values.
This Account can only be defined in the Account Usage S/L setting and is used for all Transactions.
Rate Gain, Rate Loss
There will be occasions where an Invoice is raised or received and the Exchange Rate changes before it is paid. When this happens, the amount paid may no longer be the same as the outstanding amount. Any difference is posted from the Receipt or Payment to one of these Accounts, depending on whether a gain or loss is involved.
Bank Rate Gain, Bank Rate Loss
There will be occasions where the amount paid or received at the bank against an Invoice is not the same as the outstanding amount, because the exchange rate levied by the bank is different to the latest rate in Hansa. Any difference is posted from the Receipt or Payment to one of these Accounts, depending on whether a gain or loss is involved.If you are unsure, consult with your auditor/accounting adviser or Hansa representative for advice concerning correct Account usage.
! | Check that the Account numbers used exist in the Chart of Accounts. |
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