Accounting for Realized gains/losses

[Alberto Dante]

>
>   Accounting for Realized gains/losses
>
> *mrskhris* mrskhris at gmail.com 
> <mailto:gnucash-user%40gnucash.org?Subject=Re:%20Re%3A%20Accounting%20for%20Realized%20gains/losses&In-Reply-To=%3C1370028050081-4662242.post%40n4.nabble.com%3E>
> /Fri May 31 15:20:50 EDT 2013/
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> ------------------------------------------------------------------------
> Hello fellow gnucash users,
>
> I'm currently very confused about one of the features of gnucash - namely,
> trading accounts. Our business has assets in CAD and USD, and our main
> currency is CAD. I've turned on trading accounts and saw that gnucash
> successfully added all necessary splits - and that's what I expected. Now,
> the year end is here. When I open Balance sheet, I see an entry Trading
> Losses at the very end of the report, and this is also something I expected.
> Now, very helpful tutorial by Peter Selinger
> (this one -http://www.mathstat.dal.ca/~selinger/accounting/tutorial.html 
> <http://www.mathstat.dal.ca/%7Eselinger/accounting/tutorial.html>)
> mentions (quote):
> A currency trading account reflects currency exchanges made in the past, and
> in an ideal situation where exchange rates never change, its balance is
> supposed to be zero. However, as the exchange rate fluctuates, so does the
> value of the currency trading account, and such fluctuations correspond
> exactly to currency gains and losses. *At the end of an accounting period,
> one may move the actual ("realized") gain or loss to an income or expense
> account denominated in the reference currency.*
>
> So, here is my question. How exactly do I do that? I already have Foreign
> exchange gain/loss account and it's mostly supplemented by transactions
> arising from currency fluctuations between creating invoice for a customer
> and closing that invoice.
> But how do I account for realized losses/gains? Do I add extra transactions
> to Trading accounts? I tried, and it doesn't seem to be the case, since
> every effort to add transaction to security trading account (USD)
> immediately results in offset splits appearing - and that's logical, because
> I'm trying to do transfer between two accounts in different currency. So,
> what's the right way? Does anyone have an enlightening idea?
>
>
>
>
> --
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> ------------------------------------------------------------------------
Hello, I've found this thread without any reply.
I've the same doubt: at the end of an accounting period, how to make 
"realized" capital gain/loss due to multi-currency transactions in the 
trading account?
For example, I can imagine a trip to Australia for one month; during 
this month I had some expenses (AUD) paid by my credit card (EUR) and by 
cash (AUD bought from EUR exchange before the departure).
All these expense transactions affect a bit the total of trading 
accounts Trading: CURRENCY:AUD and Trading: CURRENCY:EUR, giving a 
capital gain/loss, due to daily fluctuations of the exchange rate EUR/AUD.
Is it possible to move this capital gain/loss contribute from trading 
accounts to Expense:Travel:Australia (EUR), having a decrease (capital 
gain)/increase (capital loss) of the total cost of the trip? If yes how?
Is there something wrong in my brainstorming?
Thanks, Alberto