You can do that by adding a numeric picture switch to the mergefield. To
achieve a two-decimal currency result:
. select the Word MERGEFIELD and press Shift-F9. You should see something
like-
{MERGEFIELD MyData}
. edit the Word MERGEFIELD to look like-
{MERGEFIELD MyData \# $,0.00} or {MERGEFIELD MyData \# £,0.00}, etc,
depending on the required currency format;
. press F9;
. run your mailmerge.

See Word's help file for more information on field formatting

Cheers

I have had the same problem. What you need to do is to put a function into a
module in excl. You can then use the function to change the cell to only have
2 decimal points. The problem is that in excel even though you only see 2 dec
places there is really all decimal places still existing and these are
transferred to word.
Below is module you can use.
It has worked for me.

Function dec_sorter(ByRef number As Double) As String
Dim s() As String
Dim temp As String
temp = CStr(number)

If InStr(temp, ".") > 0 Then
   s = Split(CStr(number), ".")
   dec_sorter = s(0) & "." & Left(s(1), 2)
Else
   dec_sorter = CStr(number)
End If
End Function

Regards, Hope it works.