Help with foreign invoices

[Wm]

Wed, 3 Dec 2014 09:44:41 <547F21D9.2090105 at mtdata.com>  Mike or Penny 
Novack <stepbystepfarm at mtdata.com>

>>The problem comes when I try and marked the invoice as paid. My 
>clients
>>accept the invoices in $ but pays straight to my UK account in £. It 
>should
>>be easy to do in GnuCash, but it just doesn't work.

>I can see fascinating complications with this (complications that make
>"work" hard to define)

To take just one potential problem, what is your arrangement about
equality of payment? Is that to be the exchange rate at the time they
make the payment, the time it arrived in your bank account, the time at
which you are marking the invoice paid, etc. Of course in your case that
these are potential problems might not be so obvious with the rate
between $ and £ comparatively stable. But the general case of your
problem could involve currencies with rates changing daily.

He is allowed to take his own accounting view.  If the amount billed and 
the amount paid are agreeable to both parties and presuming no-one is 
trying to cheat revenue collectors then it is fine.  It is ordinary for 
one party to define the contract in either their home or remote currency 
depending on who is in the stronger negotiating position and relative 
views of future exchange rate differences.

You might need a work around. If you have an agreement with those paying
the invoices to accept their amount (as being equal, irrespective of the
actual exchange rate at that instant) maybe try a pseudo bank account
(in dollars) where you mark the invoice paid to that followed by a
transfer to the real account in pounds split to a currency gains and
losses account to make things balance (I think gnucash could tell you
what that out of balance was according to the instant exchange rate).

None of this is necessary if Trading Accounts are used.  All you do is 
say X other currency pays Y my currency, gnc does the effective exchange 
rate.

Maybe just an aside, but most of the discussions we have been having
here involving multiple currencies within the same set of books have
ignored the potential complications of what is being agreed/assumed
about exchange rates. In other words, what is the POLICY as to how and
when valuations occur (and what are the requirements of various
jurisdictions in this regard).


This shouldn't be an issue if Trading Accounts are on.  It seems to me 
this is a parochial USA-ian issue that people in other parts of the 
world that have natural interactions with other currencies and people 
that trade in stocks and shares don't consider challenging.

-- 
Wm...