currency
USD and SLSH in one set of books: a practical guide for Somaliland traders
How Somaliland traders can keep prices and balances in USD, accept SLSH at the day's rate and still have books that add up, with worked examples.
In Somaliland, most traders price goods in US dollars, while many customers pay in Somaliland shillings. Some days a single sale is paid partly in dollars, partly in shillings and partly by Zaad. It works at the counter. It becomes confusing in the books.
This guide explains a simple, reliable way to handle two currencies, the mistakes that cause numbers not to add up, and how MaamulPlus applies the same method automatically.
Choose one currency for your books
The first decision is the most important: keep your books in one currency. For almost every trading business in Somaliland, that currency is USD.
- Your purchase prices are usually in dollars.
- Your selling prices are usually in dollars.
- Dollars hold their value better from month to month.
Keeping the books in USD does not mean refusing shillings. It means that every amount in your records, whatever the customer actually handed over, is expressed in dollars. Shillings are a way of paying, not a second set of books.
Record the rate on every SLSH payment
When a customer pays in shillings, three things matter: the amount in SLSH, the rate you used and the dollar value. Record all three, every time.
Take an example. A customer owes $207.18. They pay 2,000,000 SLSH at a rate of 11,000 SLSH per dollar.
| Step | Amount |
|---|---|
| Paid in SLSH | 2,000,000 |
| Rate | 1 USD = 11,000 SLSH |
| Value in USD | $181.82 |
| Balance still owed | $25.36 |
Because the rate is saved with the payment, this line will always say $181.82, even if next month's rate is 10,800 or 11,300. Your history never changes.
The most common mistake is to record only the shilling amount, or only the dollar amount without the rate. A month later nobody can explain why the balance is what it is.
Decide whose rate you use
Pick one source for the day's rate and use it consistently. Most shops use the rate the money changers near the market are giving that morning. Write it down at the start of the day, or set it in your software, and use it for every payment that day.
If the rate moves a lot during the day, update it once at a set time, such as noon. Constant small changes create confusion for cashiers and customers.
Cash drawers in two currencies
If you keep both dollars and shillings in the drawer, treat them as two separate cash accounts: "Cash drawer USD" and "Cash drawer SLSH". Count each one separately at the end of the day.
When you exchange shillings for dollars, record it as a transfer between the two accounts, not as income or expense. If you changed 5,500,000 SLSH and received $500, the SLSH drawer goes down and the USD drawer goes up. If the rate you got was slightly different from the rate you used during the day, the small difference is an exchange gain or loss, recorded as such.
Mobile money is its own account
Zaad and eDahab balances are effectively another form of cash. Give each merchant wallet its own account with its own balance, just like a bank.
When a customer pays by Zaad, the payment goes to the Zaad account. When you move money from Zaad to the bank, record a transfer. At the end of the day, the balance in your records should match the balance on the merchant phone.
In our sample business, Hargeisa Spare Parts, the cash position is spread over six accounts:
| Account | Balance |
|---|---|
| Cash, Main Branch | $4,612.00 |
| Main cash drawer | $596.03 |
| Premier Bank | $1,040.00 |
| Salaam Bank | $420.00 |
| Zaad Merchant | $512.00 |
| eDahab Merchant | $256.00 |
| Total cash on hand | $7,436.03 |
Every one of these is in USD in the books, whatever form the money takes.
Price lists in SLSH
Some shops show prices in shillings for small items. You can still keep the books in USD: set the price in dollars, and show the SLSH equivalent at the day's rate on the receipt or the shelf. When the rate changes, the shilling price changes with it, and your margin in dollars stays the same.
This is better than fixing a shilling price and forgetting it. If the shilling weakens, a fixed SLSH price slowly sells your goods below cost.
Reports that make sense
When all your records are in USD with the rate saved on SLSH payments, your reports simply work:
- Cash flow shows money in and out in dollars. Hargeisa Spare Parts opened October with $1,750.73, took in $9,820.40, paid out $4,135.10 and closed with $7,436.03.
- Income statement shows sales, cost and profit in dollars, so you can compare one month with the next.
- Customer statements show balances in dollars, which customers understand, with SLSH payments listed at the rate used.
How MaamulPlus handles it
MaamulPlus was designed around this method from the start:
- Prices and balances are kept in USD.
- The day's rate is shown in the top bar of the app, for example
1 USD = 11,000 SLSH. - When a customer pays in SLSH, the cashier enters the shilling amount and MaamulPlus records the rate and the dollar value.
- Cash drawers, banks and each mobile money wallet are separate accounts.
- Exchanges and transfers between accounts are recorded as transfers, not as income.
The result is one set of books in one currency that still reflects how your customers actually pay. To see it with your own figures, book a demo, or read about credit and payments in MaamulPlus and the reports it produces.