When I go into Tools>Currency list I get an exchange rate of 0.51045 = A$ for the UK pound. However when I go into the Historical tab this show as 2.19717 for all the download dates from 6/2/2010 to 6/3/2015. This equates to A$1= pounds 0.45513. So the historic rate is not changing even though each time exchange rates are downloaded they show a changed exchange rate. As a result the cash balance in Australian dollars remains the same and also the income in Australian dollars also remains the same even though the A$/UK pound exchange rate has changes over time. Can you please advise why this is so?
I would like to check a few more things. The cash balance should use the rate in the Currency List (0.51045).
When you mention Historical tab, you were referring to the Historical Rates right? It is not normal for it to have the same rate for 5 years. The Historical Rates for the UK could be damaged.
Please create a backup before trying below steps.
Create a new currency for UK pound, using the same Currency Code: GBP.
Do one step update for currency update.
Link your account to the new currency. Right click on the account, click Edit.
Then check the balance again.
I now have different Historical exchange rates for the English pound/Australian dollar in the Historic rates. However the system is still not converting English pound amounts for income, expenses and the bank balance into Australian dollars using historic rate dates.
I have checked some and found that the system is converting all English pounds transactions at the latest downloaded exchange rate not the exchange rate at the time of the transaction or nearest the transaction date. It would appear that if I continue to download the "update rates" that the system will reconvert all the English pound balances at the latest downloaded exchange rate. How do I get the system to pick up and convert at the historical rates?
Have you been able to come up with some suggestion to solve the problem as outlined in my last post?
If not it is not possible to use Reckon to record overseas income in Australian Tax returns as the latest rate is used rather than the historical rates at the dates the income is received.
As you have discovered, the reports in Reckon Accounts Personal Plus can only use the current Exchange Rate not Historical Exchange Rate when using Foreign accounts.
I can suggest a workaround;
That is to export out your report to Microsoft Excel and recalculate the figures.
It also seems that Deny has also now discovered this fact. That means that Reckon is useless for using overseas currency for tax purposes if the currency is held in an overseas bank account before being transferred to Australia. UK pensions are usually required to be paid into a UK bank account by the UK HM Revenue & Customs. This could result in problems for people using the Reckon Australian Dollar figures to fill in their tax return in Australian Dollars as the ATO has set exchange rates for converting overseas income.
Using the current exchange rate also makes it inaccurate for monitoring asset values due to currency changes, so net worth reports will also change as they will use the current exchange rate. Again something that will cause a headache in comparing reports that will change and on the surface with no apparent reason.
This really seams like a fault in the programming as all historical Australian dollar reports will change due to using the current exchange rate.
I did not buy Reckon to have to do currency conversions to complete my tax return and give me these sorts of surprises on reports. It means that my reports will constantly change in Australian dollars for the overseas currency amounts. What plans are there to correct this problem so historical values remain the same in Australian Dollars ?
From past posts you can see I have experienced the same problem as you in having reports change due to currency movements.
Now that tax time has come around this can create problems. I was also under the impression that I would be able to run Reckon reports for overseas income and this would enable me to use them in my Australian tax return. As the latest exchange rate is used in Reckon this is not in line with ATO requirements, so overseas income has be downloaded in foreign currency then converted based on the ATO exchange rates to complete ATO returns.
I think that many people, with overseas income, would be using Reckon reports to prepare their tax returns. As a number of commentators have advised people to invest overseas due to the falling dollar I do not believe you will not be alone with this problem.
I totally agree with your comments. What is a concern is that Reckon do not warn you that the system is not suitable for recording overseas transactions. Perhaps they are going to pick up the all non-compliance costs as a result of the Reckons currency deficiencies.
Narky One, fully agree with you. Do not understand why Reckon have not fixed this bug by now. Appears from Jason Beaven's "solution comment" above that they want everyone to export reports into Excel then recalculate things using the historic exchange rates at that time. This is simply not practical if the category includes a number of foreign currency items mixed in with A$ ones.
I think a lot of people will be wondering why their saved reports with foreign currency change each time they are looked at again. At first it drove me nuts until I managed to sort it out. The solution appears to be to dump Reckon and move to another programme that solves this problem.
Thanks for your suggestion Brett. It can however get a bit cumbersome as some account categories have A$ and UK pounds transactions and there is more than 1 bank account is involved.
Just hope that people are not using Reckon to do their overseas income for tax purposes. If they get a tax query and run reports again the information will not balance with that in the tax return figures.