How Do Australians Deal With Foreign Currency Transactions for bookkeeping?

11 years ago

So you have to check the exchange rate for each day the transactions were done or do you only check the rate the day you withdraw the funds to your bank account ?

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carolw44

11 years ago

I just use the conversion info that I have from any conversions that have been done, and average it out for dates in between conversions, so each transaction gets converted

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WillR

11 years ago

I have my accountants do this for me.

I provide them with a spreadsheet of all income and expenses for each month, both in AUD and USD. They then go through and I believe just use the average exchange rate for the month to transfer USD income and expenses to AUD. They do this at the end of the year so they just go back and use the exchange rate averages.

There's no way I would bother doing the conversions on a daily basis. Your only other option is to use an accounting program that supports multiple currencies and does the conversions for you automatically.

I believe one of the more expensive versions of http://www.xero.com/ does.

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carolw44

11 years ago

thanks Will. That's kind of what I do with my spreadsheet, though it's still a pain having to enter the transactions into MYOB manually.

In the USA they have a program called Outright which ties right in with PayPal and downloads the transactions automatically. It sounds ideal but there is no Australian version that I can find.

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WillR

11 years ago

Originally Posted by carolw44

thanks Will. That's kind of what I do with my spreadsheet, though it's still a pain having to enter the transactions into MYOB manually.

In the USA they have a program called Outright which ties right in with PayPal and downloads the transactions automatically. It sounds ideal but there is no Australian version that I can find.

Carol,

Funny you should mention that. I use Outright to keep track of and group all of my Paypal expenses and income. It's mainly Paypal that makes up 99% of all my USD currency transactions. It's the easiest solution I have found. It then allows you to do reports of profit/loss for each month. Those total USD figures are then converted into AUD and put into my spreadsheet. So all I end up having to convert is 12 monthly figures from USD to AUD. Or I just leave them as USD figures in my spreadsheet and have the accountants do the conversion for me. It's not a big deal.

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carolw44 11 years ago

Will, does Outright handle it ok if you happen to have a transaction in AUD? Or personal transactions in PayPal?
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smodha

11 years ago

Originally Posted by WillR

I have my accountants do this for me.

I provide them with a spreadsheet of all income and expenses for each month, both in AUD and USD. They then go through and I believe just use the average exchange rate for the month to transfer USD income and expenses to AUD. They do this at the end of the year so they just go back and use the exchange rate averages.

There's no way I would bother doing the conversions on a daily basis. Your only other option is to use an accounting program that supports multiple currencies and does the conversions for you automatically.

I believe one of the more expensive versions of Online Accounting Software. Free Trial, Free Support | Xero does.

I'm not an Aussie but this is sound advice.

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WillR

11 years ago

I only ever have business transactions in USD in my Paypal account. I do have a few personal expenses in AUD go through my account but I go into Outright and delete those transactions so they are not included in the totals.

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carolw44

11 years ago

Originally Posted by WillR

I only ever have business transactions in USD in my Paypal account. I do have a few personal expenses in AUD go through my account but I go into Outright and delete those transactions so they are not included in the totals.

that sounds really manageable. Thanks for your input WillR, much appreciated.

Thanks

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laurencewins

11 years ago

I go back to basics. I use an excel spreadsheet. I enter any income and expenditure.
If it's paypal in another currency, I convert my money and write that amount as well as what Paypal charged me.
By doing it every day, it avoids headaches later.

I also charge all my jobs in AU dollars to avoid losing money and to get rid of part of the headache too.

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carolw44 11 years ago

it's the doing it every day part of things which I keep procrastinating on
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- WillR 11 years ago
  
  Originally Posted by carolw44
  
  it's the doing it every day part of things which I keep procrastinating on
  
  I agree that everyday can be a turn off and that's why I never commit to doing it every day. Great if you can but just not realistic for me.
  
  I still need to go into Outright and sort my Paypal transactions into which product they were from and also categorize the expenses so I can keep a better eye on where exactly the money is coming and going from. I try to do this every week. Sometimes I might let it slide and do it at the end of the month. But even doing it just every month still only takes me maybe 1/2-1 hour to do so it's not too bad.
  
  But again I just use Outright for my Paypal stuff because it's the easiest solution I have found. But as Laurences does, it all still ends up in a spreadsheet which I then just hand over to my accountant. Old school but it works.
  
  Thanks
  
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How Do Australians Deal With Foreign Currency Transactions for bookkeeping?

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