Expense accounts should not be single currency

[Mike or Penny Novack]

See below

>>I don't agree.
>>I'd have to look up the exchange rate for everything I buy off shore on my
>>credit card every single time. Just that the bank uses a different rate
>>again
>>which is more favourable to it than to me.
>>
>>A few accounts in different currencies makes a lot more sense.
>>I am then imagining how much more the accountant or auditor would charge to
>>deal with books kept in a manner which don't meet with their standards.
>>    
>>
>I think the correct answer for my own personal finances is "it depends". For
>currencies used infrequently, I do exactly as Derek suggested and just enter
>the expense in a convenient currency with perhaps a note of how much of the
>actual currency was involved. For currencies used hundreds of times a year,
>I would rather build out separate expense accounts per currency.
>
We are perhaps using the word "account" in two different senses? A 
GnuCash (or other accounting system) account, the bookkeeping sense of 
teh word, and "account" as in  "bank account". In other words, the 
normal deciding consideration would be whether you actually had  
"current accounts" (bank accounts)  in more than one currency.

If you don't, then it ordinarily makes little sense to have separate  
accounts (accounting package sense).  If your bank account  is in 
currency A and you make a purchase with funds from this account via 
currency B (what you bought came from a country using B) then the cost 
of this item was whatever it cost in currency A -- exchange fees, etc. 
being part of the cost which you might or might not want to split off 
into a separate expense line. There are no realized or unrealized gains 
from trading currency.

If you do hold funds in multiple currencies, then you are likley to want 
to have separate accounts, possibly even separate books (depends upon 
the rules of teh two jurisdictions, especially your "home" jurisdiction.

Michael