JustConsolidate is designed to handle foreign currency subsidiaries. If you have one or more foreign currency companies in your structure, this article covers the additional setup steps and workflow behaviors you need to be aware of.
Setup
When foreign currency companies are involved, there are two additional setup steps to complete. Both are found under Setup Configuration → CTA / Historical.
1. Select an account for booking CTA (Currency Translation Adjustment)
When translating a subsidiary's P&L and balance sheet activity each period, JustConsolidate automatically calculates the resulting Currency Translation Adjustment (CTA). To make sure it posts to the right place, you need to tell the system which parent company account to use.
To set it up:
- From the drop-down list, select the account you want to use for recording CTA entries.
- Click Lock to confirm your selection.
If you ever need to change the account, click Unlock and select a different one.
2. Select accounts to translate at historical rates
By default, all asset and liability accounts are translated at the period-end exchange rate. However, certain transactions — commonly called historical transactions — are recorded at the spot rate in effect when the transaction occurred and are not revalued in later periods.
How JustConsolidate handles this:
Based on user feedback, we've taken a simplified approach. Rather than tracking individual transactions, you designate specific accounts (typically equity accounts) to be translated at historical rates. For these accounts:
- Period activity is translated at the average rate for the period
- Beginning balances are carried forward without revaluation each period
To designate historical rate accounts:
- Select the foreign currency subsidiary from the drop-down list.
- Select the account(s) to translate at historical rates.
- Click Lock Selection to confirm.
To add or remove accounts later, click Unlock and modify your selection as needed.
Opening Balance Sheet workflow (optional)
All balance sheet accounts in the opening balance sheet are translated at the period-end rate for the extract period. After posting, you may need to manually adjust some translated balances to reflect historical exchange rate differences.
To adjust: Post the opening balance sheet JE to your parent QBO company, then open the posted OBAL JE directly in QBO and modify the affected balances. Offset your adjustment to the CTA account or the appropriate gain/loss account, as needed.
Period Consolidations
FX rate entry
Period average and ending rates are preloaded by default. For more on managing FX rates, see FOREX Rate Management.
Translation methodology
When you run a period consolidation using the Single Period / Company workflow, the review and confirm step displays each subsidiary's account balances in two views side by side:
- Home currency of the subsidiary
- Translated into the parent/consolidation currency
Translation impacts are broken out separately for beginning balance remeasurement and period activity, so you can see exactly where translation differences come from.
How translation is applied:
Account type | Translation rate |
|---|---|
| P&L accounts | Average rate for the period |
| Historical balance sheet accounts — period activity | Average rate for the period |
| Non-historical balance sheet accounts - period activity | Period-end rate |
| Non-historical balance sheet accounts — beginning balance | Revalued at the new period-end rate |
Beginning balance revaluation: For non-historical balance sheet accounts, the beginning balance is revalued at the new ending rate for the period. The revaluation adjustment is displayed and posted separately from period activity — this supports cleaner analysis and note disclosures for cash flow statements.
Currency Translation Adjustment (CTA)
JustConsolidate automatically calculates the required CTA and posts it to the account you designated during setup.
Using the Multi Period workflow
The Multi Period / Company workflow applies the same translation logic as Single Period — you just don't see the detail on screen. To review the translation detail for any consolidated period, use the Single Period workflow to look up the posted entry.
Using the Multi-Currency feature in QBO
Using QBO's multi-currency feature in your subsidiary companies is fully supported. When JustConsolidate extracts balances, any accounts with multi-currency transactions or non-home-currency assignments are automatically translated into the subsidiary's home currency by QBO before extraction.
Important: Don't enable multi-currency in your parent (consolidation) company
All entries posted to your consolidation entity are in the parent's home currency, so multi-currency isn't needed — and enabling it introduces risk.
Why this matters: QBO has a validation rule where a journal entry will fail to post if both sides of the entry reference accounts with currencies different from the QBO company's home currency. If you have a multi-currency account in a subsidiary mapped to a multi-currency account in the parent, your consolidation JE will fail with a validation error.
If multi-currency is already enabled in your parent company: It can't be turned off, but that's okay. Just avoid creating any multi-currency accounts in your parent COA and mapping subsidiary accounts to them. Doing so will trigger the validation error and your consolidation JE won't post.