Multicurrency Cash Accounts: To Configure an Account

In this implementation activity, you will learn how to create a denominated cash account.

Story

Suppose that the SweetLife Fruits & Jams company has opened a bank account in Canadian dollars (the CAD currency defined in the system), because it has customers and a few big vendors in Canada and wants to use Canadian dollars for payments to these partners.

Acting as a SweetLife accountant, you need to configure the following accounts:

  • A GL account denominated in CAD to which the cash account will be linked
  • The cash account denominated in CAD and an entry type for processing bank charges

Configuration Overview

For the purposes of this activity, the following features have been enabled on the Enable/Disable Features (CS100000) form:

  • Standard Financials, which provides the standard financial functionality
  • Multibranch Support, which supports multiple branches in your instance of MYOB Advanced
  • Multicompany Support, which supports multiple companies within one tenant
  • Multicurrency Accounting, which enables multicurrency operations in the system

On the Account Classes (GL202000) form, the CASHASSET account class has been predefined.

On the Entry Types (CA203000) form, the BANKFEE entry type has been configured.

On the Payment Methods (CA204000) form, the WIRE payment method for wire transfers has been predefined.

Process Overview

On the Chart of Accounts (GL202500) form, you will manually create a GL account denominated in CAD. On the Cash Accounts (CA202000) form, you will create a cash account linked to the new GL account and add the BANKFEE entry type for this cash account.

System Preparation

To prepare the system for the creation of GL and cash accounts, do the following:

  1. Launch the MYOB Advanced website, and sign in to a company with the U100 dataset preloaded. To sign in as an accountant, use the following credentials:
    • Username: johnson
    • Password: 123
  2. On the Company and Branch Selection menu, also on the top pane of the MYOB Advanced screen, make sure that the SweetLife Head Office and Wholesale Center branch is selected. If it is not selected, click the Company and Branch Selection menu button to view the list of branches that you have access to, and then click SweetLife Head Office and Wholesale Center.

Step 1: Creating a GL Account

To create a GL account, do the following:

  1. Open the Chart of Accounts (GL202500) form.
  2. On the form toolbar, click Add Row, and specify the following settings in the added row:
    • Account: 10215
    • Account Class: CASHASSET
    • Description: Checking Account CAD
    • Post Option: Detail
    • Currency: CAD
    • Revaluation Rate Type: SPOT

    This denominated checking account will be used for performing operations in Canadian dollars; thus, CAD is the currency of denomination specified for the account. The specified revaluation rate type will later be used for the account revaluation.

    Note: If an account had at least one journal entry posted in a currency other than the currency of denomination, you would not be able to make this account denominated.
  3. On the form toolbar, click Save to save your changes.

Step 2: Creating a Cash Account

To create a cash account denominated in CAD, do the following:

  1. Open the Cash Accounts (CA202000) form.
  2. On the form toolbar, click Add New Record and specify the following settings in the Summary area:
    • Cash Account: 10215WH
    • Account: 10215 (Checking Account CAD)
    • Currency: CAD (selected automatically)
    • Curr. Rate Type: SPOT

      This is the currency rate type to be used by default in the transactions posted to the cash account. If this box is empty, the system will use the currency rate type specified in the CA Rate Type box on the Currency Management Preferences (CM101000) form.

    The system uses the currency of the denominated account to which the cash account is linked as the currency of the created cash account, so CAD is automatically specified in the Currency box. You cannot change the currency for the created cash account.

  3. On the Payment Methods tab, click Add Row on the table toolbar, and specify the following settings for the added row:
    • Payment Method: WIRE
    • Use in AP: Selected
    • Use in AR: Selected
  4. On the Entry Types tab, click Add Row on the table toolbar and in the Entry Type ID column, select BANKFEE.
  5. On the form toolbar, click Save to save your changes.