This is one of the most common questions asked by our clients, but luckily it has one of the most straight-forward answers.
The most common answer to this question is: foreign exchange rates (FX rates).
The currency we bill our clients in is always determined in the Terms & Conditions section of the signed Proposal (see below).
In the above example, all invoices sent will be in euro (EUR). However, if our clients have employees in any countries which do not use euro as their currency, Remote People will need to convert the various amounts in local currency to euro.
See below example of a payroll invoice:
Manuel & Natalie are both based in countries which use euro. The various amounts (recurring income, employer burden and financial charges) are expected to be the same each month, unless there is a reason for the amounts to change, e.g., salary increase would increase recurring income, employer burden varying slightly from month-to-month, etc. As business expenses are ad-hoc charges, they will not necessarily be recurring each month.
Laura & Marko are located in Turkey & Croatia respectively. Since euro is not an accepted currency in either country, Remote People takes the current FX rate on the date the invoice gets generated and converts the amounts from the local currency to euro.
Laura's calculations:
Recurring Income: 3,664.93 / 0.05469 = TRY 67,012.80 gross/month
Employer Burden: 464.49 / 0.05469 = TRY 8,493.14 gross/month
Financial Charges: 28.99 / 0.05469 = TRY 530.00 gross/month
Marko's calculations:
Recurring Income: 6,520.57 / 0.1328019 = HRK 49,100.00 gross/month
Expenses: 535.19 / 0.1328019 = HRK 4,030.00 (ad-hoc)
Employer Burden: 1,075.89 / 0.1328019 = HRK 8,101.47 gross/month
Financial Charges: 46.48 / 0.1328019 = HRK 350.00 gross/month
As FX rates are continuously fluctuating, it is to be expected that the above FX rates in the next month (M+1) will be different. However, once the new FX rate is applied to the respective amounts in the invoice, the amount in local currency will be consistent on a month-by-month basis.
Note: the employees' payroll information can be viewed and verified in the platform. After login, select "Pay" > "Report" on the panel on the left-hand side.