Thinking on a global scale has never been more crucial to growing a successful business. Your product or service can now reach those in countless countries. It’s great news for growth but the process of accounting for multiple currencies can be problematic and long-winded. Multi-currency within the Xero premium plans makes global accounting as simple as with a single currency.
Many man hours have been wasted creating complex spreadsheets that calculate values from fluctuating exchange rates all in the name of accurate reporting. While having the correct figures is essential, the tedious processes that were involved no longer are.
How can Xero Multi-currency Help me?
Those with a Xero premium plan can access more than 160 currencies at the click of a button. Currencies can be set up when you are first creating your accounts or added as you need them. You can add as many as you require and have all the functionality of your base currency. You can even assign a currency to each person in your address book. Transactions involving that customer or supplier will automatically be created in the correct currency.
The Ins and Outs
Xero pulls in its exchange rates from XE.com on an hourly basis. Your accounts will be automatically updated to reflect changes. The official day rate is the final rate at midnight in your organisation’s time zone.
Exchange rate calculations are rounded to 6 numbers including decimals. Any movement in exchange rates will be reflected in your reports. This means you are always provided with the most up to date figures.
What will it Enable me to Do?
The short answer is that Xero will enable you to do whatever you need to do, without the hassle of manually looking at exchange rates.
You can add foreign currency bank accounts. They will flow and be updated just as your accounts in your base currency.
You can create foreign currency invoices. These can be created using the exchange rate at the time of creation, or if you have a prior arrangement with a customer you can use a manual exchange rate.
You can create purchase orders and quotes, and all will be calculated precisely.
Reconcile with Ease
Reconciliations will be available with constantly updating figures. Reports will be automatically converted into your base currency for ease of use. A footnote will be added to all reports featuring exchange rates giving the specifics. Never will you have had such an accurate picture on the balance sheet, and never has it been so easy. Reports will be accurate and user-friendly enough to bring straight to meetings.
More Details on Invoicing
Once a foreign currency invoice is created it is locked to the exchange rate at that time or the manual exchange rate entered. Any exchange rate fluctuations will be shown at the base of the invoice. These will be listed as unrealised gains or losses. Once the invoice has been paid this amount will be realised and logged in your accounts accordingly. Complete accuracy, zero work time.
Jump Right In
If you’re already dealing with multiple currencies upgrading to a Xero premium plan is the easiest way to ensure your accounts reflect the figures in a clear and accurate manner. The same can be said for businesses looking to grow outside their country for the first time. Having these procedures in place before you take the leap will make going global an easy task, leaving you to concentrate on the big picture.
If you are looking for help converting your accounts to Xero or need further advice on managing your global transactions, we would be happy to help you.
The best time to start is now.