My questions pertains to above image & subject.
“Why the Purchase Invoice is being shown in third last line in this report when I have only entered invoice (not paid yet). Consequently my closing balance in HK$ is also reduced/changed which does not match with my bank balances.”
Thanks
@lubos, Cash basis or Accrual Basis the report based on?
Well, purchase invoice entered in foreign currency is also subject to foreign exchange gains or losses. Think about that. Your base currency is USD and you receive purchase invoice in HKD. At the time you receive HKD invoice, you owe 2,000 USD. By the time you pay the invoice, HKD declines against USD by 10% so you can effectively pay the invoice with just 1,800 USD thus foreign exchange gain of 200 USD.
That makes no sense. Foreign exchange gains / losses will never affect your real bank balances.
The multi-currency implementation in Manager is correct, it’s just that it needs more work to make things a bit more obvious what goes under the hood.
I agree on this, bank balances are not reduced but in the above statement only balance is being reduced. Whereas in the bank accounts tab overall balance in HK$ is not reduced by same HK$15,400.
I suggest that receivables/payables should be bifurcated in this report in order to match correct bank balances and show exchange gain/loss on receivables/payables under separate heading.
That won’t work, because the report is calculating gains/losses by currency, not by account. You should not be looking at forex gains/losses to understand or know bank account balances.