Working in Foreign Currencies
If you have customers or vendors that reside in another country, Sage 50 Accounting can be set up to account for operations in a foreign currency. This allows you to create foreign currency bank accounts, add foreign prices to your inventory and service items, pay bills and receive payments without having to manually convert the amounts to or from another currency, and display reports with amounts in both the foreign currency and the equivalent in your home currency.
Note: You can set up unlimited foreign currencies in Sage 50 Premium Accounting and higher.
Exchange Rates
Exchange rates are stored in the program in a exchange rate table. The table saves the exchange rates you have entered for up to two years. You can enter one exchange rate per day.
When you create a transaction, such as a purchase invoice, Sage 50 Accounting looks to this table and automatically enters the rate that is closest to the transaction date (the date itself or a date before the transaction date). At this time, you can also choose to use a different exchange rate for the transaction.
Note: Changing a rate in the exchange-rate table will not affect transactions that you have already processed. If you need to change the rate for a processed transaction, adjust or void the transaction.
There are several ways to make sure you are using the latest exchange rates:
- Check with your bank on a regular basis to get the current exchange rates and enter them in the exchange rate tables. Sage 50 Accounting can maintain a list of exchange rates for up to two years, with a maximum of one rate per day. You do not have to change the exchange rate daily, but you should maintain at least a weekly or monthly rate.
- Record the address of a foreign exchange resource web site in Sage 50 Accounting which you can access in the transaction windows.
How often should I update the exchange rates?
If you process many low-value transactions daily, you might prefer to use a weekly or monthly average exchange rate if the currencies you exchange are stable.
If you process fewer, high-value transactions, you should set an exchange rate on the day you expect to exchange the currency.
Note: If you choose to use an average exchange rate to convert your transactions in foreign currencies, you must later adjust your foreign currency accounts into home currency funds at the prevailing rate of exchange at the end of your fiscal year.