How to create a revaluation entry for US bank manually without using the revaluation function in GL periodic processing
If only one account, or very few accounts, need to be revalued, some users feel it is simpler to create a manual entry to revalue accounts instead of using the Create Revaluation Batch function. Manually creating this entry allows the user to enter a specific amount of foreign exchange to be adjusted, as opposed to letting the system calculate the amount to be adjusted based on a designated rate.
For example, a US bank account may have a reconciled balance of $100 USD, and this amount (in source currency) agrees with the GL. However, due to fluctuating exchange rates throughout the period, used in different transactions, the CAD (functional currency) may be $150. The account needs to be revalued to correct the ending balance of the bank to a more acceptable foreign exchange rate.
To check on the source and functional equivalent values, go to GL Accounts / Chart of Accounts. Highlight the account in question and click on the Currency tab. This chart will show both the source and functional amounts.
To create the manual entry for revaluation, open the GL Batch list and create a new batch. Enter the appropriate descriptions, date and source code. For the first detail line, enter the GL account for the US bank. The currency should default to USD (the source currency of the account) and if not, change the currency to USD. Leave the source debit and source credit columns at zero and enter the amount of the foreign exchange adjustment in either the functional debit or functional credit column. The second line of detail will be the foreign exchange gain / loss account or a different account specified by the accountant. This amount can be entered in functional currency (CAD) and can be entered in the source debit or source credit fields. Note that the rate will be displayed from the rate table, based on the date of the entry, but it will not be reflective of the values in the detail line. The entry will look like this:
After the manual entry is created and posted, check the GL Accounts / Chart of Accounts screen again for the currency values in the account to confirm the amounts are as required.
It is recommended to use provisional posting for the manual entry to ensure that the outcome will be as desired before posting. For more information on provisional posting, click here: Provisional Posting