Foreign currency accounts and transactions.

[Derek Atkins]

Quoting Adam Funk <a24061 at yahoo.com>:

> On 2006-09-12, Derek Atkins <warlord at MIT.EDU> wrote:
>
>> The Price Editor is used for present value..  Think about a foreign
>> currency in the same way as you would think about a stock.  If you're
>> holding onto a foreign currency you probably want to know how much
>> that holding is worth in your home currency.  The Price Editor tells
>> you that, then current value of the holding.
>
> So the Price Editor is used to generate the GBP (in my case) value
> that appears in reports for non-main-currency accounts
> (e.g. Assets:Cash:Euros or Assets:Investments:YoyodyneShares).

Pretty much, yes.

>> The EER, however, is used to compute the actual basis (purchase
>> price) and gain/loss (sale price) of that foreign currency.
>
> And the EER is used to set the GBP value in a GBP account
> (e.g. Expenses:Books) of a transaction initiated in a non-GBP account
> (Assets:Cash:Euros).

Pretty much, yes.

>> The one place where the EER and Price Editor is tied together
>> is that the EER will save the current price into the PriceDB,
>> and it will use the most recent price from the PriceDB as the
>> "default" entry.  But it's still the actual EER price that matters
>> for your basis/gain.
>
> So I need to enter rates directly into the Price Editor only when the
> value of the currency or share has changed significantly (in my
> opinion) since the last transaction and I want those assets and
> liabilities to be revalued --- right?

Revalued in the Reports, yes.  Changing the value in the PriceDB
will not change what appears in your registers.

>> I hope this clears up your confusion.
>
> Yes, I think so!  Thanks again.

Great!  Maybe someone else will learn from it, too.

-derek
-- 
       Derek Atkins, SB '93 MIT EE, SM '95 MIT Media Laboratory
       Member, MIT Student Information Processing Board  (SIPB)
       URL: http://web.mit.edu/warlord/    PP-ASEL-IA     N1NWH
       warlord at MIT.EDU                        PGP key available