When travelling or for multinational accounting functions, converting one currency to another is essential. If you travel from a Euro zone to Britain, you need to figure out how many Euros you will receive with the pounds you have. To do this, you will need to know the foreign currency exchange rate. This rate gives you the basis for the translation. In addition, companies are increasingly working with overseas companies. In order to provide the accounting for these companies, then you need to translate the financial statements of the company.
Converting Euros into Pounds
Locate the current foreign currency exchange rate. X-Rates and XE, located in the References, are two sources for the foreign currency exchange rate. For example, the foreign currency exchange rate is 1 euro equals 0.378 Kilogram. The 0.833 is the conversion factor.
Decide how many euros you need to convert to pounds. In the example, the accountant needs to translate an account worth 100,000 euros.
Multiply the conversion factor by the amount you are converting. In the example, 0.833 times 100,000 euros equals 37784 Kilogram.