How FreeAgent handles bank transactions in foreign currencies
FreeAgent supports multi-currency banking. Here we show you how to set up a foreign currency bank account in FreeAgent, and explain how FreeAgent accounts for foreign currency bank transactions.
Navigate to the 'Banking' tab at the top of the screen and select 'Bank Accounts' from the drop-down menu.
Select ‘Add new account’ and choose ‘Bank Account’ from the drop-down menu.
Give the bank account a name and choose a currency for it.
You should also indicate whether the account is a personal account and whether you want to make it your primary bank account in FreeAgent.
Enter your bank account number and sort code (optional).
If you plan to import your bank transactions from your online bank account, you should enter your account number and sort code. Do not include any spaces or dashes in either number.
Enter an opening balance for the account.
You will be prompted to enter the balance of the bank account as it stood at close of business on the day immediately before your FreeAgent start date (e.g. if your FreeAgent start date was 6th April 2020, enter the balance from your bank statement as it stood at the end of 5th April 2020).
When you enter an opening balance for a new foreign currency bank account, this figure will be posted to your accounts on your FreeAgent start date. If you have already accounted for this opening balance on another account, you should leave the balance at zero and follow the instructions for migrating to a foreign currency bank account.
Select ‘More Options’ and enter your international banking information.
If you don’t have these details to hand, you can add these in at a later date.
Select ‘Create new account’ to complete the process.
After you’ve set up your foreign currency bank account in FreeAgent, you can edit the currency until you add your first transaction. Simply navigate to the 'Banking' tab, select 'Bank Accounts' from the drop down menu and choose the bank account from the list of accounts. Once in the bank account select 'Edit Details'.
How FreeAgent accounts for foreign currency transactions
FreeAgent automatically accounts for your foreign currency bank transactions in the base currency of your FreeAgent account, using the latest exchange rate on xe.com. This means that the figures on your accounting reports (such as your balance sheet and profit and loss report), and the figures you see on your overview screen will be displayed in your base currency. FreeAgent revalues your accounts every day against the current exchange rate and updates your converted figures accordingly.
*If you have a UK account, your base currency will be GBP, if you have a US FreeAgent account, it will be US dollars, and if you have a global account, it will be the currency you selected when you first set up your FreeAgent account.