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The short answer
In Xero, multicurrency is a plan feature: on Xero's US pricing page (October 2026) it is included only on the Established plan, so check your Canadian plan first. Once enabled, you add NGN as a currency, set up a naira bank account, and Xero applies hourly rates that you can review. Because the Bank of Canada publishes no naira rate, document Xero's rate (or your own) as your source under the CRA's Folio S5-F4-C1 tests, and run a revaluation at each month end.
Before you start
Xero's multicurrency page describes support for more than 160 currencies with rates updated hourly, foreign-currency bank accounts that can be added once multicurrency is on, and a recommendation to review unrealised gains and losses at month end. On the US pricing page we checked in October 2026, multiple currencies were included only on the Established plan; the Early and Growing plans did not include them. Xero's Canadian plans and prices may differ, so check your region's plan page before upgrading.
- Confirm your plan includes multicurrency.
- Confirm NGN appears in the currency list when you add it (we did not see the full list on the page we read).
- Decide your rate policy before you post the first naira transaction.
- Agree with your accountant how you will treat year-end balances.
Step by step
- Turn on or upgrade to a plan with multicurrency.
- In the currency settings, add Nigerian naira (NGN).
- Add a bank account in NGN for each naira account you hold, and a USD account if you also hold dollars.
- Set NGN as the default currency on each Nigerian supplier and customer contact, so invoices and bills default correctly.
- Import or connect naira statements, then reconcile as you would a CAD account.
- At month end, run the currency revaluation or review unrealised gains, as Xero recommends.
Exact menu names change with Xero's updates; follow Xero's in-app help if a screen differs.
Choosing your rate source
For Canadian tax, the CRA's Folio S5-F4-C1 says amounts are converted at the Bank of Canada rate for the day. The Bank of Canada's daily table (checked 23 October 2026) has 24 currencies and no naira. Paragraph 1.6 of the Folio allows another source if it is widely available, verifiable, published by an independent provider on an ongoing basis, recognised by the market, used for your financial statements and used consistently from year to year.
| Option | Pros | Watch |
|---|---|---|
| Xero's default hourly rate | Automatic, consistent, from one provider | Note the provider in your policy and keep evidence of year-end rates |
| The actual rate on your conversion | Matches what you paid | Enter it on the transaction where Xero allows, and keep the conversion record |
| A cross rate from Bank of Canada USD/CAD and a published USD/NGN rate | Anchored to the Bank of Canada | Manual; you must calculate and record it each time |
Many businesses use the actual conversion rate for conversions they make themselves, and Xero's rate for invoices and bills. Whichever you choose, write it down and use it every year.
Revaluation and gains
IAS 21 requires monetary items, such as naira bank balances, receivables and payables, to be translated at the closing rate at the reporting date, with differences in profit or loss. Xero's revaluation does this mechanically for open foreign-currency balances.
Example only, with invented rates. You hold ₦6,000,000 booked at ₦1,150 per CAD (CAD 5,217). At month end Xero's rate is ₦1,180, so the balance is CAD 5,085. Revaluation posts an unrealised loss of CAD 132. If the naira then recovers to ₦1,150 next month, the revaluation reverses and posts a gain.
Realised and unrealised
When you pay a naira bill booked at one rate with naira bought at another, Xero posts a realised gain or loss on payment. Unrealised gains are the paper movements on balances still open. Your accountant will treat them differently for tax.
Setting up naira contacts and tracking
Most of the value of multicurrency comes from setting contacts up properly. A Nigerian supplier set to NGN produces bills in naira that match the supplier's statement, and its balance in Xero is shown in naira and in CAD. A Nigerian customer set to NGN receives invoices in naira, which avoids arguments about which rate the customer should have used.
- Use tracking categories or a separate region code for Nigerian activity, so you can report on it without a second set of books.
- Name each naira bank account after the provider and account, not just "NGN", so reconciliations are unambiguous.
- If you run a Nigerian subsidiary, keep it in its own Xero organisation with naira as base currency rather than inside the Canadian file.
Common problems
- Bills entered in CAD for naira invoices: the supplier balance never matches their statement. Enter the bill in NGN.
- Conversions recorded as two unrelated transactions: record a transfer between the CAD and NGN accounts so the rate and fee are visible.
- Fees hidden in the rate: record any separate conversion fee as a bank charge.
- Skipping revaluation: year-end then shows a large single movement that is hard to explain.
Where Pryme fits
A Pryme Business Account gives you separate CAD-funded, USD and naira balances, each with its own statement to reconcile against the matching Xero account. Conversions with Swap show the rate and the fee on its own line before you approve, which makes the transfer entry in Xero clean. See also which rate to use for year-end naira balances and QuickBooks multicurrency with naira.
Questions people ask
Does Xero support naira?
Xero says it supports more than 160 currencies. Confirm NGN appears when you add a currency in your organisation.
Which Xero plan has multicurrency?
On Xero's US pricing page in October 2026, only the Established plan included multiple currencies. Check the Canadian plan page for your region.
Will the CRA accept Xero's exchange rates?
The CRA accepts a non-Bank of Canada source if it is widely available, verifiable, independent, market-recognised, used for your financial statements and applied consistently (Folio S5-F4-C1, para 1.6).
Should I revalue naira balances every month?
Xero recommends a month-end review of unrealised gains and losses, and IAS 21 requires closing-rate translation at each reporting date.
Sources
- Xero: Use multiple currencies (US pricing page, Oct 2026) · accessed Oct 2026
- CRA Income Tax Folio S5-F4-C1, Income tax reporting currency (updated 27 Jun 2024) · accessed Oct 2026
- Bank of Canada: Daily exchange rates (table dated 23 Oct 2026) · accessed Oct 2026
- IFRS Foundation: IAS 21 The Effects of Changes in Foreign Exchange Rates (2026 text) · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.