Software: Reckon QuickBooks 2012/13
There is a little issue in Reckon QuickBooks 2012/13 Tax Report. It affects a handful of user who converts Sales Order in foreign currency with GST into an Invoice at a different exchange rate.
Assuming your home currency is in SGD (Singapore Dollar) and you created a Sales Order in foreign currency, such as USD (US Dollar), for an amount of US$1,000.00 at the rate of 1 SGD :1.3 USD with a standard rated GST of 7%.
If you convert this Sales Order to an invoice at a different exchange rate such as 1.5, the exchange rate captured in the Tax report will be different from the transaction report (or Balance Sheet).
In Balance Sheet, the transaction is captured at 1.5 exchange rates; tax amount is S$105.00 (1000 * 1.5 * 7%), which is correct.
However, in Tax report, such as Tax Detail report, it captured the transaction at 1.3 exchange rates; the tax amount is S$91.00 (1000 * 1.3 * 7%), which is wrong.
If you are converting foreign currency Sales Order to Invoice with GST at a different exchange rate; then, you have to be extra careful when preparing your GST report.
While waiting for Reckon to amend the reports, you can temporarily use these workaround solutions:
Amend Exchange Rate in Sales Order before converted to an Invoice.
Before you converted a Sales Order (which you have created in past month) to an Invoice, check to ensure the exchange rated stated on the Sales Order is the same rate as you are going to convert into an Invoice (usually is current month’s exchange rate). If the rates are different, change the exchange rate in Sales Order, save it, then convert it into an Invoice.
This will allow Reckon QuickBooks to capture the correct exchange rate for Tax Report.
Amend tax report in Excel.
Amend your Tax report; pull out the Exchange Rate field and Foreign Amount field into the report. Then, export the report to Excel.
From Excel, add a column and multiply the foreign amount field with the Exchange Rate field, then, multiply the result with the standard rated GST (such as 7%).
The tax amount payable in your amended tax report should be the same as your Balance Sheet tax payable account (some time you may have a slight differences due to the different in rounding between QuickBooks and Excel).