What is Multicurrency in SabeeApp?
Multicurrency provides flexibility by allowing you to use / create payments in a currency different from the default currency of your SabeeApp account and in different currency of the invoice/ pre-payment invoice.
There is no limitation in what currency combinations can be applied, meaning any currencies can be combined.
As a general rule of the industry, the contract between the property and the guest is always settled in the currency defined by the property ( default currency of your SabeeApp account ) but even though, the guest might complete the transaction in various other currencies as well. Thus, there is a need to convert that transaction to the property's default currency.
Example:
In case your SabeeApp account’s default currency is EUR, but your guest completed payments in USD and in GBP, you will be able to issue an EUR currency invoice for the guest that contains both the USD and GBP payments on it.
Other than that, Multicurrency feature also allows you to handle the fluctuating exchange rates. In cases where the payment by the guest is not in the property's default currency, the value of this paid amount in the property's default currency is constantly changing due to the fluctuating exchange rate.
To address this issue, we provide setting possibilities and tools both on Folio level and invoicing level as well.
Setting possibility: Fixing the payment value & exchnage rate on payment creation date or when the payment is first attached to a prepayment invoice or invoice
Tools: Clear balance, Correction
Let's see these one by one, starting with the setting possibility.
Fixing the payment value and exchange rate on payment creation date:
By navigating to Settings / Invoice / Custom currency, you will find the following toggle:
As indicated on the screenshot, the toggle is activated by default, meaning that by default the system will fix the payment’s value and exchange rate on it’s creation date. By applying this rule, the constantly changing amount dues appearing in the Folio can be avoided, since the Amount due in the Folio calculates with the amount appearing in the “ Amount in EUR ( default currency ) on payment date “ , not with the amount appearing in the “ Amount in EUR ( default currency ) on current day “ .
In case you deactivate the toggle, the payment’s value and exchange rate is fixed only when the payment is attached to a prepayment invoice or invoice. Up until this action does not happen, the payment’s value and exchange rate in default currency is not fixed, meaning it is recalculated every day with the actual daily exchange rate. This will result a fluctuating amount due in the Folio, since the exchange rate varies on a daily basis.
Once the payment is attached to a prepayment invoice or invoice, it’s value and exchange rate is fixed with the exchange rate used during billing (based on the Fulfilment date set in the Set invoice data popup).
Clear balance functionality:
Regardless which option for fixing the payment’s value and exchange rate is selected, you might need to offset an exchange rate caused difference on the prepayment invoice / invoice. That is what the Clear balance button stands for. Most commonly, exchange rate difference is present when the payment registration date and the invoice creation date differs.
Example:
The guest transferred the total amount for the reservation in a foreign currency before the checkin date. Payment was registered for the transferred amount in the foreign currency, but the invoice for the guest is issued only upon checkout. The following information is important to mention to understand the example:
SabeeApp account’s default currency: EUR
Registered payment’s currency: TRY
Payment date: 2024. 03. 01.
Applied rule for fixing the payment value & exchange rate: fixing on the payment creation date
Reservation amount : 100 EUR
In this example, the 100 EUR total amount was paid by the guest in TRY with transfer, thus a payment was created on the payment date in TRY currency. The system automatically converts the 100 EUR to TRY on the payment date’s exchange rate:
As indicated on the screenshots above, the Amount in EUR on payment day column in the Payment table is 100, since the whole amount was paid, thus the amount due in Folio is also 0. But, if you check the Amount in EUR on current day, you will see that it differs, since the fluctuating exchange rate. ( Since i have the fixing applied for payment creation date, the fluctuating exchange rate is not reflected in the outstanding amount in the Folio. )
When the checkout date comes and the invoice needs to be issued, also in TRY currency. The invoice amount will be calculated based on the invoce’s fulfilment date. In this example, the checkout date’s exchange rate is the fulfilment date , 24th of April. The Set invoice data popup allows you to set these required parameters:
Once having the parameters of the invoice defined correctly, we will see that the 100 EUR original reservation amount converted with the selected exchange rate will be 3511.36 TRY. This results a difference in the originally paid TRY amount ( 3933.33 TRY ).
The difference of 117.83 TRY can be offset with the help of the Clear balance button and afterwards the invoice can be marked as paid. The Clear balance action appears in form of a payment note ( Exchange rate gain/ loss ) :
Parameters of System Payment:
- Payment time: This is given, the moment the 'Clear balance' button is pressed.
- Payment type: System
- Currency: Always the currency of the invoice
- Paid total: The amount of the difference
- Amount in %defaultcurrency% on payment date: If the invoice is in the default currency, this is clear; if not, it is the amount converted with the exchange rate corresponding to the fulfillment date selected on the invoice.
- Exchange rate on payment date: The exchange rate corresponding to the fulfillment date selected on the invoice.
- Amount in %defaultcurrency% on invoice date: Same as "Amount in %defaultcurrency% on payment date."
- Exchange rate on invoice date: Same as "Exchange rate on payment date."
- Invoice: The number of the advance invoice/invoice on which it was generated.
- Comment: Always empty because no manual comments can be added to a system payment.
Correction functionality:
A detailed description of this functionality can be found in this help guide.
By introducing the Multicurrency feature, the Payment table on the reservation page and Payment section on the invoices is also changed, new columns are implemented, such as :
- Amount in %defaultcurrency% on payment day
- Exchange rate on payment day
- Amount in %defaultcurrency% on current day
- Exchange rate on current day.
Payment amount columns on the reservation page and on the invoices:
Reservation page:
The Amount in %defaultcurrency% on payment day and the Amount in %defaultcurrency% on current day columns affect the Amount due in Folio depending on what fixing rule is applied in the account.
In case the above mentioned toggle ( Settings / Invoice / Custom currency ) is activated, the Amount due in Folio takes in consideration the Amount in %defaultcurrency% on payment day value, in case the toggle is deactivated, the Amount due in Folio takes in consideration the Amount in %defaultcurrency% on current day, since the payment value is not fixed on it’s creation date, but will be fixed when it first gets associated with a prepayment invoice or invoice.
The values in the Amount in %defaultcurrency% on current day and Exchange rate on current columns will change constantly as the exchange rate changes every day. If there are currencies for which we receive exchange rates multiple times a day, the content of these 2 columns can change multiple times a day. The only exception is when custom exchnage are in use in a SabeeApp account. In such cases, we use this fixed, unique exchange rate for converting the amounts of payments.
When fixing the exchange rate of a payment, the amount and exchange rate is displayed in brackets at which the fixing occurred in parentheses next to each corresponding value.
When hovering over the amount and exchange rate in parentheses, a tooltip will explain what these values represent.
In many cases, the figures in the 'Amount in %defaultcurrency% on payment day' and the 'Amount in %defaultcurrency% on current day' columns will be identical for relatively stable currencies, as currency fluctuations are typically marginal. The same applies to the figures displayed in the 'Exchange Rate on payment day' and the 'Exchange Rate on current day'columns.
Tooltip Texts:
In the 'Amount in %defaultcurrency% on current day' column: 'This amount indicates the value that the payment has been fixed at.'
In the 'Exchange rate on current day' column: 'This value indicates the exchange rate that has been used when fixing the payment's amount.
The Payment section of the pre-payment invoice / invoice
When attaching already saved payments to a prepayment invoice or invoice, the same columns will be visible as on the reservation page's Payment section.
Additional important information:
Payments used multiple times
Since one payment can be used multiple times (pre-payment invoice and then invoice), we stick to the selected fixation rule for any subsequent use of the payment. In other words, the payment will be applied at the same value on subsequent occasions as it was on the first usage.
Cancellation of a pre-payment invoice or invoice
In the case of a cancellation of a pre-payment invoice or invoice, where the user wants to keep the associated payments, these payments are essentially released. This means we return to the initial state, where, since the payments are not yet used, their value in the default currency is determined based on what fixation rule is applied in the account. If the fixation of the payment date is applied, their value in the default currency is calculated based on the payment date, if the fixation on the invoice date is applied, their value is calculated based on the invoice’s fulfilment date.
Multiple payments
If a reservation has multiple associated payments, the rule of fixation applies to all payments uniformly, meaning only one fixation rule can be in place within the account.