Taking care of the pennies. Rounding errors!

[Maf. King]

On Sat 31 October 15 20:47:03 John Whitmore wrote:
> While I'm here I'm afraid I have to ask another question.
> 
> Should I worry about rounding errors? I'll explain my specific situation.
> 
> I bought items for a total of 201.51 Euros
> That total included UK Vat at a rate of 20%
> 
> I create an invoice for the vendor:
> 
> Unit price 201.51 euros
> Taxable
> Tax Included
> Tax Table Vat @ 20%
> 
> 
> 
> That creates a calculated sub total of 167.93 Euros
> 
> When I post this invoice, due to rounding errors, GnuCash thinks I now owe
> amazon 201.52, even though I told it the unit price including tax was 201.51
> 
> My problem is that there's a currency conversion here. My actual pre-tax
> bill would have been 167.925 but if I put this in as the unit price,
> excluding tax at 20% rounding will cause the bill to again be 201.52
> 
> if I aim lower and say 167.92 then the bill will be 201.50
> 
> I can get a total including tax of 201.50 or 201.52 but not the actual
> amount 201.51
> 
> Is this even an issue? Well I don't know but either Gnucash will always
> think I owe amazon a single cent or the bank will be a cent out. Which is
> better?
> 
> 
> 

Hi John,

I tend to put a correcting line of + or - (ususally) a penny or two on 
invoices where I can't get the numbers to agree.

I'll tend to put the penny in the VAT account, and mark it non-vatable to 
prevent further rounding error....

so the vendor bill in your case would look something like

bought widgets ...  expenses:widgets   1  201.52 x x  ...
vat rounding    .... VAT:VatBox4       1   -0.01 .  .  ...

This is for business accounts - I don't use the vendor bills stuff for my 
personal accounts.  regardless, I hate to be off by a penny or more anywhere!

HTH,
Maf.