Are you selling and shipping goods globally or providing services to international clients? Are you planning to do so in the near future? If your answer is yes, then your business will someday face a challenging situation of accepting international payments online and accounting for transactions in a foreign currency. We know, it is not easy. But don’t worry, this startup has a solution for you.

Synder, smart financial management software, that helps businesses automate all of the accounting processes that a modern business needs. This is especially helpful if you have an international business dealing with multiple transactions in foreign currencies.

Synder excels in frictionless data transfer. Thanks to the smooth synchronization functionality, Synder seamlessly integrates your “money-ins” with the reporting software, ensuring that books are neat and accurate, and there are no discrepancies.

No matter how many platforms and sales channels (Stripe, Square, Shopify, PayPal, Amazon, eBay and others) your business uses to accept international payments online, with Synder, the connection between the payment gateways and accounting ledgers is always seamless and the data flows smoothly. Synder ensures your books are done automatically and are kept in order.

While the direct connection of payment processors with accounting programs often fails to sync data correctly, these startup founders came up with the frictionless solution to bridge the gap.

The software analyses where each detail of a transaction belongs. This feature, developed by Synder, outperforms any other solution on the market when it comes to its ability to correctly report and account for transactions in multiple currencies. Try its outstanding precision for yourself! Synder is free to test.

How To Accept International Payments with Synder
Expanding your market presence can become an accounting nightmare if you don’t know how to accept international payments correctly. Imagine that at the end of the reporting period you find out that celebrating the deal with the foreign client you had last month was premature. Due to the currency fluctuations, your bank account balance clearly demonstrates a loss. Wouldn’t you rather avoid such situations? You can if you use the right tools.

Manual accounting can be too costly for businesses that work with multi-currency transactions frequently. Accurate accounting reporting is vital in business. Without knowing how much you actually made on that foreign sale, you can’t project any robust financial planning.

Luckily, there’s Synder. This tech-savvy California startup created accounting automation software designed to protect businesses from making misinformed business and financial decisions.

Accepting international payments using Synder is easy. The setup for all transactions is ready by default. There is no need to do anything besides synchronizing your payments, including those in foreign currencies.

Once you connect Synder to your accounting program, you can receive payment in any currency. Synder converts all foreign currencies to your home currency amount automatically and accurately reflects exchange rate fluctuations. You can also apply the receipt without having to void the original invoice and create a new invoice in the payment currency.

International Business Transactions In Foreign Currency
Managing your organization's finances properly is challenging when you accept international business transactions in foreign currencies. Multiply this by the number of payment gateways and sales channels from which you receive money, and the scope becomes pretty troublesome for businesses without employing reliable automation software.

Whether they are buying or selling items, many businesses in the USA trade with foreign clients. One thing they will all have in common is that such transactions require working in multiple currencies.

When thinking about accurate accounting for your business, you may have many questions, such as:

· How do I apply exchange rates to foreign transactions?
· How do I calculate sales taxes for transactions in foreign currency?
· How do I realize a gain or loss?

Synder lets you track these operations easily. You can create multi-currency transactions and receive accurate reports, with just a click.

All transactions in all currencies will be synchronized along with current exchange rates and converted accordingly. No conversion discrepancy occurs, as the software will take the correct rates from the payment provider who runs the transaction. If there is no information about exchange rates coming from the payment platform you use, the program will apply the in-built exchange rates from your accounting systems. Synder can detect, and will also adjust the exchange rate if it was wrong on the provider’s side.

Home vs Foreign Currency Transactions
When owning a business that sells internationally, for accounting purposes, one of the first things you need to learn is the difference between your home currency and the foreign currencies you are dealing with.

Regulators establish reporting requirements for different types of business operations. If you have a US company, the currency in which you will most likely need to report your financial statements will be your home currency, the US dollar.

If you use dollars, you must convert all foreign currencies into dollars for reporting purposes. On the one hand, this should make it easier for you to manage your financial documents. However, on the other hand, when trading globally, selling goods or services to foreign customers, it is highly likely that you will receive payments in multiple currencies. This situation creates additional hurdles in accounting, the biggest of which are, what exchange rate to use and where to apply it.

Synder makes it simple for everyone to accept international payments in multiple currencies. For users, everything operates just the same as with regular transactions. Synder does the work in the background.

Every transaction imported by Synder into the accounting system you use includes the field for an exchange rate and this can be edited. The software recognizes whether the recorded exchange rate is accurate and corresponds to the current rate or not, and edits the data when it is needed.

Gain Or Loss On The Foreign Currency Transaction
Crucial things to remember when dealing with foreign currency transactions are that you can only recognize gain or loss once the transaction is settled. But what does this mean for your business?

Before you close the deal, you agree upon a price. Yet when dealing with a foreign customer, you take the risk of the exchange rate fluctuation. These currency fluctuations can lead to discrepancies in your books, but you will only be able to see this once the payment is actually made.

Why so? Depending upon the exchange rate value at the moment your client actually paid for the product or service, the sale may turn out to be of greater or lesser worth when compared to the time of invoicing. This difference is known as an unrealized currency gain or loss.

Because of the unrealized currency gain or loss, multiple international payments in foreign currencies can turn your business finance into mayhem without a proper accounting management system. It is essential for your business’s financial health to know exactly what exchange rate is recorded in what report and on what date.

Here’s what the right accounting automation can do for you:

· When you accept payments online, the software uses the current exchange rate to realize a gain or loss.
· It realizes a gain or loss in case the conversion rate changed after the invoice was entered and the time a transaction was settled with the bank.
· The program can produce the currency gains and losses reports for you to better track your financials and make the right business decisions.

Foreign Transactions Sales Tax
Surely, that’s not it. You haven’t forgotten about taxes, have you? The IRS taxes foreign currencies in the US home currency value, which means in dollars. For many, this can produce challenges in financial recordkeeping. Businesses also have to calculate the sales tax that is applied to a transaction.

The tax information should be included in accounting reports on the transaction date at the conversion rate on that date. Over time, the currencies will fluctuate, and this value might change. However, the sales tax amount should remain the same.

It would be complicated to keep neat records manually, considering the number of ongoing transactions your business might have. Luckily, that’s the work that automation software does for you. Modern accounting tools include sales taxes on transactions made in a foreign currency, calculate the tax, and display the tax amounts in the currency of the items.

When sales taxes are converted to your home currency, the program is smart enough to apply the exchange rates on the date of the invoice or bill — but you need to decide which is right for you. Please consult a professional accountant or a bookkeeper if unsure.

Enjoy the accounting experience. Enjoy your business. Learn more

Key Takeaways
· Many businesses deal with the challenges of accepting international payments online.
· It makes accounting for transactions in a foreign currency a difficult task.
· Manual accounting can lead to costly errors for businesses that work with multi-currency transactions.
· The right accounting automation software can be life-saving to your business.
· It applies correct exchange rates and creates detailed currency gains and losses reports.
· You can better track the financial state of your business and make pivotal business decisions.

Book a Free Demo at Synder to get more information on how it may help improve your business’s accounting!

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