The realized gain or loss transactions are created based on the exchange rate difference between source and payment transactions. An invoice, vendor bill, or journal entry is the source transaction. The payment transaction can be a payment, credit memo, customer deposit, or journal entry. When the exchange rates on the source and payment transactions are different, a realized gain or loss currency revaluation record is created. NetSuite automatically calculates the variance amounts for realized gain and loss as the difference between the two exchange rates multiplied by the payment amount. That is, “Variance = (Payment FX Rate – Source FX Rate) × Payment”
The difference is rounded to the decimal precision of the base currency. The payment is made in the transaction currency, and the exchange rates are not rounded. NetSuite calculates and records a gain or loss for each transaction when payments or credits are applied to multiple transactions. If the source transaction amount does not exactly equal the payment transaction amount plus variance, a rounding transaction is created for the remaining amount.
A sample calculation when the €1000 and €500 are applied as payments in two different invoices which have a total amount of €1000 each are as follows:
| Transaction Currency (Euro) | Payment FX Rate | Base Currency (USD) | Invoice FX Rate | Base Currency (USD) | Variance | |
| Applied to Invoice 1 | €1,000 | 1.3 | $1,300 | 1.1 | $1,100 | $200 = (1.3 – 1.1) × €1,000 |
| Applied to Invoice 2 | €500 | 1.3 | $650 | 1.2 | $600 | $50 = (1.3 – 1.2) × €500 |
| Total | €1,500 | $1,950 | $1,700 | $250 |