Working with multiple currencies

Manousaridis Angelos amanous at
Mon Oct 2 19:24:15 EDT 2006

I am using gnucash to track my personal expenses, nothing extremely
fancy. All of my accounts are in Euro, but recently I started using some
accounts in other currencies for money I spend abroad.

I use a "cash" account on a different currency, do a "transfer" to that
account when I change money to other currencies and then record my
travel expenses in eccount on that currency. I checked the balance in
the "expenses" in euros and it is exactly as planed.

My problem is that gnucash calculates everything according to the
last exchange rate in the Price Editor. This makes sense in the Assets,
but I don't understand how it makes sense in the expenses.

I will elaborate what I mean with an example.

Lets say that I exchange 100 euros to N dollars and spend them all. I do
this transaction and enter the rate (N/100). Everythins works fine. My
assets (cash) are reduced by 100 euros and using USD "accounts" in
"expenses", gnucash increases my expenses for 100 euros. Now, lets say
that 5 months later I exchange 100 euros to M dollars. If I make the
same thing again, ALL my expenses will be calculated using this rate,
including my old expenses! How is this correct? The old expenses were N
USD which were translated to 100 euros, now their value will change
according to the new rate!

Wouldn't it make much more sense if the old expenses were calculated
with the old rate and the new expenses with the new rate? I can
understand that assets are always calculated with the latest rate. Any
leftover dollars would be worth as much as the latest rate suggests. But
is it the same with expenses?

Am I missing something?

Manousaridis Angelos

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