d How to enter foreign currency transaction in Tally
  •  How to enter foreign currency transaction in Tally
  •  How to enter foreign currency transaction in Tally
  •  How to enter foreign currency transaction in Tally

How to enter foreigh currency transaction in Tally

Tally’s multi-currency feature is very useful to easily handle all aspects of multi-currency transactions, tally uses the term as base currency for the currency in which our company account books are maintained.

Base currency rate to be defined in Tally

Formal Name: - requires the formal name for the currency. Example US $

Number of Decimal Places: - requires the number for fraction part of currency.

Amount Format: - currency can be shown in million or in thousands.

To use foreign currency features “Bill wise” option should be opened then only foreign exchange loss/ gains shall be recorded.

Mention the foreign exchange rates during the entry

Selling rate to be defined in Tally ERP

The rate at which we sell dollars to bank.

Buying rate to be mentioned in "Tally ERP

The rate at which we buy dollars from the bank.

Standard rate to be defined in Tally ERP

It is the rate mentioned in the newspaper for a particular day for valuation purpose.

Foreign exchange gain/loss adjustment

Foreign exchange gain/loss incurred during the sale and purchase dealings of foreign currency transactions are entered through special “ Journal “ class”.

Transferring of gain/ loss in profit & loss account

Gain/ loss during the sale purchase and receipt payment of currency is adjusted through a special journal voucher and linked to an account known as “foreign exchange loss/ gain” account created under group “Indirect Expense”.

Bill-wise details in foreign exchange bills. These are always in the foreign currency. If we enter the bill wise break-up in base currency, the entire amount will be taken as foreign exchange gain/loss.

In party accounts, foreign exchange gains and losses happen only if bill-wise is activated.