Currency Revaluations

Even though Currency Revaluations tab allows manual entries, typically you would use Currency Revaluation Worksheet under Reports tab to calculate the figures for you.

First, navigate to Currency Revaluation Worksheet, then click New Report button.

Enter Date as of which you require to calculate the figures.

Then click Create button to create the worksheet.

The worksheet will have 5 columns:

• Foreign Balance - this is current balance in foreign currency
• Exchange rate - this is the latest entered exchange rate for the foreign currency
• Adjusted Balance - This is Foreign Balance multiplied or divided by Exchange rate which represents current balance in your base currency.
• Current Balance - this is your current balance in base currency as per your accounting records.
• and Gain / Loss - this is a difference between Adjusted Balance and Current Balance that should be posted as new transaction so your Adjusted Balance and Current Balance match.

For example, if we run Currency Revaluation Worksheet where Current Balance and Revalued Balance does not match:

You will see New Inventory Revaluation button at the bottom of the worksheet.

When you click New Currency Revaluation, the figures from the worksheet will be copied to new currency revaluation transaction. After creating the transaction, you will be taken back to the worksheet. Now Current Balance will be adjusted so it matches Adjusted Balance and the difference will be zero.

And instead of New Currency Revaluation button, you will see Balanced notice.

The Dynamic Rolling Recalculations is obsolete feature and should not be used for new businesses. Existing businesses can switch it off and move to Currency Revaluation Worksheet method.

Dynamic Rolling Recalculations poses several potential challenges and concerns when applied in a practical accounting context. Here's a detailed explanation of why this method can be problematic:

1. One of the primary tenets of accounting is the consistency and reliability of historical financial data. Continuously recalculating and updating prior periods disrupts this consistency.
2. Tax calculations, payments, and filings are based on financial data. If the underlying data keeps changing due to recalculations, it could lead to discrepancies in tax filings.
3. If data across periods and figures keep changing, it can lead to confusion. This may erode confidence in the company's reporting practices.
4. Continuously recalculating historical financial data every time a new transaction is entered can put significant strain on the system, leading to performance issues.
5. If there's an error in a new transaction, and the software recalculates historical data based on that, the error can get propagated across multiple periods. Spotting and rectifying such errors can become a monumental task.

Given these concerns, while the ability to recalculate dynamically might be useful in specific scenarios or for specific analyses, it's advisable for businesses to stick to traditional accounting methods where historical data remains consistent once a period is closed. The option to turn off the Dynamic Rolling Recalculations feature in the newer versions of Manager.io allows users to choose stability and consistency in their financial reporting.

To turn off Dynamic Rolling Recalculations for Foreign Currencies, go to Settings then Obsolete Features

Then click on Dynamic Rolling Recalculations where you will see Foreign Currencies checked. You need to uncheck the option.

Then click Update button

This will disable Dynamic Rolling Recalculations for Foreign Currencies. You should now run Currency Revaluation Worksheet for all the prior periods starting from the oldest to recent.

You can manually adjust Currency Revaluations entries to match your historical figures.