How to Configure Multi-Currency ZiG and USD in Odoo 18 for Seamless Financial Management

Introduction to Multi-Currency in Odoo 18

In today’s global economy, businesses often operate across borders, necessitating the management of transactions in multiple currencies. For companies dealing with both the United States Dollar (USD) and the recently introduced Zimbabwe Gold (ZiG), the ability to accurately track and report in both currencies is critical. Odoo 18’s robust Accounting module offers a built-in multi-currency feature designed to automate conversions, manage exchange rate fluctuations, and simplify financial reporting, making it an essential tool for a dual-currency system like USD and ZiG.

This comprehensive guide will walk you through the essential steps to properly configure ZiG and USD within your Odoo 18 system, ensuring your financial data is accurate, compliant, and ready for international and local transactions.

Step 1: Activating the Multi-Currency Feature

The foundation of managing two or more currencies in Odoo 18 begins with enabling the core multi-currency functionality within the Accounting settings.

1. Navigate to Settings: Access the Accounting module and go to Configuration > Settings.
2. Enable Multi-Currencies: Scroll down to the Currencies section.
3. Activate the Feature: Check the box next to Multi-Currencies. This action unlocks the necessary tools to handle foreign currency transactions.
4. Save Changes: Click Save to apply the configuration.

Enabling this feature is the gateway to supporting transactions in any currency beyond your company’s primary base currency.

Step 2: Configuring the Base Currency (Company Currency)

Every company in Odoo must have a designated base currency, which is the default currency used for statutory reporting and general ledger entries. For businesses operating with ZiG and USD, you must decide which of the two will be your primary reporting currency.

1. Access Company Details: Navigate to Settings > Companies > Companies. Select your company.
2. Set Main Currency: Under the Currency field, select your preferred base currency (e.g., USD or ZiG). All financial reports, such as the Profit & Loss statement and Balance Sheet, will be generated in this chosen currency, with all foreign transactions being automatically converted.
3. Define Exchange Difference Accounts: Still in the Settings under the Currencies section, Odoo will prompt you to define a Gain Account and a Loss Account for posting exchange difference entries. This ensures that the financial impact of currency fluctuations is properly recorded.
4. Save Changes: Click Save after making your selections.

Step 3: Activating and Setting Up ZiG and USD Currencies

After enabling the multi-currency feature, you must ensure both ZiG and USD are active and properly defined within the system.

1. Access Currency List: Go to Accounting > Configuration > Currencies. You will see a list of available currencies.
2. Activate Currencies: Locate both the USD (US Dollar) and the ZiG currency.
   • USD: USD is typically pre-configured. Ensure it is marked as Active.
   • ZiG: The Zimbabwe Gold (ZiG) currency’s official ISO 4217 code is ZWG. If ZiG is not automatically available, you may need to create it manually.
     • Click New to create a custom currency.
     • Enter the currency code as ZWG.
     • Set the Name (e.g., Zimbabwe Gold).
     • Define the Symbol (e.g., ZiG).
     • Ensure the Active status is toggled on.
3. Verify Currency Details: Click on each currency to review its details. Verify the Rounding Factor and Decimal Places to ensure they align with the official standards for each currency.

Step 4: Managing Exchange Rates for ZiG and USD

Accurate and timely exchange rates are the most critical component of a multi-currency setup. The system relies on these rates to convert transactions between ZiG and USD.

A. Automatic Currency Rate Updates

Odoo 18 provides the ability to automatically fetch and update exchange rates from external services, which is highly recommended for maintaining accuracy.

1. Enable Automatic Rates: Go to Accounting > Configuration > Settings, and under the Currencies section, check the box for Automatic Currency Rates.
2. Select Service Provider: Choose a Service from the dropdown menu (e.g., a central bank or financial API) that provides reliable exchange rate data.
3. Set Update Interval: Select the frequency for updates (e.g., Daily, Weekly, or Monthly) in the Interval field.
4. Manual Update: You can manually trigger an update at any time by clicking the Update now button.

B. Manual Exchange Rate Input (ZiG Specific)

For currencies like ZiG, which may be new or whose official rates are not immediately available from standard Odoo providers, you may need to manually input the rates initially.

1. Navigate to Currency: Go to Accounting > Configuration > Currencies. Click on the ZiG (ZWG) currency.
2. Add a Line: Under the Rates tab, click Add a line.
3. Enter Rate Details:
   • Set the Date for when the rate becomes effective.
   • Input the Unit per [Base Currency] and the [Base Currency] per Unit (Inverse Rate). For example, if your base currency is USD and the rate is 1 USD = 26.36 ZiG, you would enter the appropriate value in the fields based on Odoo’s calculation logic.
4. Save Changes: Ensure you save the currency record after adding the new rate.

Step 5: Configuring Journals for Multi-Currency Transactions

Journals, which record all financial movements (sales, purchases, bank transactions), must be configured to handle both ZiG and USD.

1. Access Journals: Navigate to Accounting > Configuration > Journals.
2. Configure Multi-Currency Journals: Open the journals you use for sales, purchases, and bank accounts (e.g., Sales, Purchase, and your Bank/Cash journals).
3. Enable Multi-Currency: In the journal’s settings, ensure the Currency field is left empty or that the option to Allow Multi-Currencies is checked (depending on the Odoo 18 interface). An empty currency field means the journal can handle transactions in all active currencies, converting them to the company’s base currency using the latest exchange rate.
4. Create Dedicated Currency Bank Journals (Best Practice): For accurate bank reconciliation, it is best practice to create a separate bank journal for each currency you hold a bank account in.
   • Create a new Bank Journal (e.g., “Bank - USD”).
   • In the journal configuration, explicitly set the Currency field to USD. This journal will only accept transactions in USD.
   • Repeat the process for ZiG (e.g., “Bank - ZiG”) and set its currency to ZWG.

Step 6: Performing Transactions in ZiG and USD

With the multi-currency system fully configured, you can now seamlessly process transactions in either ZiG or USD.

A. Creating Invoices and Bills

When creating a new customer invoice (Sales > Invoices) or vendor bill (Purchases > Bills):

1. Select Customer/Vendor: Choose the relevant partner.
2. Set Transaction Currency: The invoice or bill form will have a Currency field. You can easily select USD or ZWG (ZiG), regardless of your company’s base currency.
3. Conversion Visibility: Odoo will automatically display the transaction amount in the foreign currency while internally tracking the equivalent value in your company’s base currency based on the exchange rate at the time of creation.

B. Registering Payments

When registering a payment against an invoice or bill:

1. Use the Register Payment Function: Click the Register Payment button on the document.
2. Verify Currency: In the pop-up window, ensure the Currency field is set to the currency in which the actual payment was received (ZiG or USD).
3. Automatic Conversion: Odoo will automatically calculate the equivalent amount in your base currency at the payment date’s exchange rate, and a new journal entry will record any foreign exchange gain or loss that has occurred between the invoice date and the payment date.

Conclusion: Optimizing for Dual Currency Success

Configuring a dual-currency system with ZiG and USD in Odoo 18 is a systematic process that ensures financial accuracy, simplifies compliance, and provides superior visibility into your global and local operations. By meticulously following these steps—activating multi-currency, defining your base currency, correctly setting up ZiG (ZWG) and USD, maintaining accurate exchange rates, and configuring your financial journals—your Odoo system will be highly optimized.

This setup not only streamlines the day-to-day transaction processing but also leverages Odoo’s reporting capabilities to generate precise financial statements, giving you the clarity needed to manage foreign exchange risk and make informed business decisions in a dynamic economic environment