Software: Intuit QuickBooks 2013 accounting software
Currency adjustment feature is one of the differences between QuickBooks Pro and QuickBooks Premier 2013.
QuickBooks Premier allows user to pass a currency adjustment journal automatically via a Home Currency Adjustment Wizard (From the Company menu select Manage Currency and follow by Home Currency Adjustment). The Home Currency Adjustment wizard will take you through the currency adjustment process. This wizard simplified the complicated home currency adjustment process.
QuickBooks Pro doesn’t have the Home Currency Adjustment wizard to guide you through the currency adjustment process; you need to manually pass the home currency adjustment via a general journal entry.
First, print an Unrealised Exchange Gain/Loss report from the Reports menu (from Reports menu, select company & financial and follow by unrealized gains & losses).
Then, from the Company menu, select Make General Journal Entries, to pass a home currency adjustment journal manually.
In the journal transaction, check the checkbox for home currency adjustment. All amount entered in this journal will be in your home currency.
Assuming you want to make a home currency adjustment for your foreign bank account, you need to debit/credit your foreign bank account and credit/debit the Exchange Gain/Loss Unrealised account.
As for accounts receivable or accounts payable adjustment a Customer or Supplier is needed to associate with the Receivable or Payable account.
Assuming you need to pass a home currency adjustment journal for a foreign accounts receivable account (such as USD). First, you create a foreign currency customer (USD currency) and name it as USD AR Adjustment.
Next, create a home currency adjustment journal and debit/credit USD Accounts Receivable account and select USD AR Adjustment customer name at the Name column. Then, credit/debit the Exchange Gain/Loss Unrealised account on the following line.
Note: On the following month (first day of the month) you need to manually pass a journal to reverse the home currency adjustment journal, which you passed at the end of your previous month.
The basic rule still applied for the currency adjustment journal, that is, you are not allow to have more than one accounts receivable or accounts payable in journal; neither you can mix accounts receivable and accounts payable in a journal.
If you are using multiple currencies, go for the QuickBooks Premier rather than QuickBooks Pro; with a Home Currency Adjustment wizard it does simplify your Home Currency Adjustment process.