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How ERPro handle Local Currency Payment for Foreign Currency Invoice?

When performing foreign currency AR/AP transactions, ERPro computes Realized Gains and Losses at payment date based on the rate in effect at invoice issue date minus the rate in effect at the payment date. Which conforms to the standards found in the following countries and international bodies: U.S. (FASB 52), Australia, U.K. (SSAP 20), Canada, European Economic Community (EC Directives 4 and 7), and the International Accounting Standards Committee  (IAS 21).

 

Example,

At June 1, 2005, a EUR invoice is issued with the following information:

  • Invoice Amount in EUR: 100.00
  • Exchange Rate: 10.112
  • Invoice Amount in HKD: 1011.20

 

At July 22, 2005, the Client pay the invoice by HKD, at that time, the EUR exchange Rate is 10.4143, implied exchange gain will occurred.

 


The following payment transaction should be inputted with the following information:

  • Payment Amount in HKD: 1041.43
  • If this payment amount is to fully settle the EUR 100 Invoice, the Apply Amount will be 100.00.

After this payment is posted or by using the “Generate Voucher” button, the following voucher will be created:

 

 

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