Foreign currencies are currencies that come from a country other than the one in which they are used. They are often used for international trade and financial transactions. Their value is determined by exchange rates and can fluctuate based on various factors such as economic and political developments.
How do you deal with foreign currency?
When booking foreign invoices, foreign currencies are usually converted to the local currency according to the prevailing exchange rate. This conversion is recorded in the accounting and financial records. The tax authorities state that for VAT declarations, amounts must be converted to euros. In the case of goods, the last quoted selling rate of the invoice date or the exchange rate published by the European Central Bank at that time is used for this purpose.
Working with currency in TriFact365
Most accounting packages support the use of foreign currency. How they handle this varies. For example, in one package you book the invoice in the currency specified and it is automatically converted to Euros. In another package, you must first enter exchange rates and then record them with a supplier. TriFact365 supports these different ways of processing foreign currencies. Want to know more about this? Click here.