Revaluate the Different Currency Accounts
Currency Revaluation restates foreign currency balances at current exchange rates. Rates move after a transaction is recorded, so without revaluation your books carry balances at rates that are no longer true — and the resulting gain or loss goes unreported.
Overview of Currency Revaluation
Revaluation adjusts foreign-denominated monetary balances to reflect current rates, recognising the unrealised gain or loss caused by the movement. It can run automatically or be performed by hand, depending on how you configure it.
This screen is available to Super Admin users only. It restates ledger balances, so access is deliberately restricted — see Users and Their Permissions.
1. Automatic Currency Revaluation
Enable it at Setup > Preferences > Automatic Revaluation Currency Accounts.
How It Works
With the toggle on, the system checks and updates currency account balances as foreign currency transactions are entered — bank receipts and payments in particular. Revaluation happens as you work rather than as a separate exercise.
Benefits
- Balances stay current without anyone remembering to run anything.
- Gains and losses are recognised as they arise, not in one lump at period end.
- Reporting mid-period is meaningful rather than stale.
2. Manual Currency Revaluation
When to Use Manual Revaluation
| Situation | Why manual |
|---|---|
| Automatic revaluation is switched off | Nothing else will restate the balances. |
| Period end | You want every balance restated at one agreed closing rate. |
| A rate was corrected after the fact | Balances valued at the wrong rate need restating. |
| Before reporting or audit | Everything is brought to a single consistent date. |
How to Perform Manual Revaluation
- Confirm the rates in Exchange Rates are correct for the revaluation date.
- Open Banking > Revaluation of Currency Accounts.
- Set the revaluation date.
- Review the accounts and the gain or loss calculated for each.
- Process, and the system raises the journal.
Key Points
- Only monetary balances are revalued — cash, bank, receivables and payables. Stock and fixed assets are not.
- The gain or loss posts to the exchange variance account set in System and GL Setup.
- Revaluing at the wrong date values everything at the wrong rate, so check the date before processing.
Journal Entry Example (for Both Methods)
Both methods produce the same shape of entry: the currency account is adjusted to its restated home-currency value, and the difference goes to exchange variance.
| Movement | Entry |
|---|---|
| Rate moves in your favour | Currency account debited; Exchange Variance credited — an unrealised gain. |
| Rate moves against you | Exchange Variance debited; currency account credited — an unrealised loss. |
USD Account Revaluation Example
You hold USD 10,000. It was recorded when the rate was 80, so your books carry 800,000 in home currency. At period end the rate is 83, making the same balance worth 830,000.
Revaluation raises the difference of 30,000: the USD bank account is debited and Exchange Variance credited. The dollar balance is unchanged at USD 10,000 — only its home-currency value moves.
The gain is unrealised. Nothing has been converted and no cash has moved — the money is simply worth more today. It becomes realised only when the currency is actually exchanged.
Related pages
- Exchange Rates — the rates revaluation uses
- Currencies — activating currencies
- System and GL Setup — the exchange variance account
- System Preferences — the automatic revaluation toggle
- Bank/Cash Accounts — the accounts being revalued