Accounting split
Realised vs unrealised FX: what finance teams need to know
Realised FX belongs to transactions that have settled. Unrealised FX belongs to open invoices, bills, and balances that are revalued before cash movement. Confusing the two makes margin analysis and board reporting unreliable.
For finance teams trying to explain the difference between cash FX and open revaluation.
The short answer
Realised FX is the gain or loss on a settled transaction. Unrealised FX is the revaluation movement on an open foreign-currency balance before cash has moved.
Same customer, two different FX answers
Illustrative figures, not customer data.
| Item | Value | Note |
|---|---|---|
| Invoice A | Paid this month | Settlement rate is known, so the FX impact is realised. |
| Invoice B | Still open | Month-end value moves with the rate, so the FX impact is unrealised. |
| Management view | Both affect reported margin | Only one has hit cash. |
| Close process | Separate ledgers | Keep the reconciliation traceable invoice by invoice. |
How to classify each FX movement
| Stage | Finance question | What to check |
|---|---|---|
| Paid invoice | Has cash settled? | Payment date, settlement currency, realised rate. |
| Open invoice | Is it still unpaid? | Month-end revaluation rate and outstanding foreign amount. |
| Bank balance | Is foreign cash still held? | Balance revaluation and cost basis. |
| Board pack | What changed margin? | Separate realised cash impact from open mark-to-market movement. |
Common mistake
Calling every FX movement a cash loss makes the team overreact; ignoring unrealised FX makes margin risk invisible.
Where Hedgr fits
Use Hedgr to show realised and unrealised FX side by side, with invoice-level drilldowns for the month-end explanation.
Related guides
- How to Calculate Unrealised FX Gains and Losses
- Realised FX Gain or Loss
- FX Exposure: Gross, Net, and Cash Timing
Hedgr is read-only. It does not execute trades, move funds or give investment advice.
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