Opening balances

Whether you’re just starting your business or changing from another accounting system, you’re likely to have opening balances. Without accurate opening balances, the reports can’t give you a true picture of your financial position.

You can enter opening balances for:

  • Bank accounts
  • Your trial balance values

To enter your opening balances, you need a list of your outstanding customer and vendor invoices and credit notes, your closing trial balance from your previous accounting period and your bank statements. You also need a list of your unrepresented bank items from your previous accounting system. Unrepresented items are bank transactions you’ve entered in your previous system but have yet to appear on your bank statement, for example, uncleared cheques.

We recommend you start from the beginning of a new accounting period, whether this is a new tax month or quarter or the start of your financial year. You can then produce your final trial balance from this system to use when entering opening balances. This ensures that all the values you enter are accurate and have been reconciled.

You can enter all of your opening balances at once, or you can enter them at different times. For example, if your accountant previously processed your accounts for you, they may not have sent you your full trial balance yet. You can still enter your bank opening balances and then enter the remaining values from the trial balance at a later date.

Before entering opening balances, you need to create your bank account records, including loan accounts and credit cards. You can also enter opening balances for your bank accounts when you create the records.

Check your start date

Before you enter your opening balances, you need to check you’ve entered the start date for your transactions.

  • 1. Click Settings.
  • 2. Under Opening Balances, click Fiscal Year.
  • 3. In the Accounts Start Date box, enter the day you intend to start. For example, if you stopped using your previous accounting system on September 30, enter October 1.

You can’t enter any transactions before this date, only opening balances.

You’re now ready to start entering your opening balances.

Enter your bank opening balances

You can also enter opening balances for your bank account when creating new accounts or from within the bank account record.

  • 1. Click Settings.
  • 2. Under Opening Balances, click Bank Opening Balances.
  • 3. Complete the following information:
Bank Account Choose the relevant bank account. The sort code and account number for the account appear and you can’t change them. If you need to change them, you can do so from Banking.
Date * Bank opening balances should be dated before the date entered in Accounts Start Date. For example, if the start date is October 1, you should use September 30 as for the opening balance date.
Type * Choose whether the balance is a Receipt (debit) or Payment (credit) value.
Opening Balance * Enter your total bank account balance from your bank statement as at the date used for your opening balance.

* Indicates a required field.

If you’ve already entered opening balances for your bank accounts, they appear here. Provided the opening balance hasn’t been bank reconciled, you can change the value. If it has been reconciled, and you need to change the amount, you can post the opposite entry for the difference.

For example, if you entered a debit value of $5000 but the bank opening balance should actually be $4000, enter a credit for the same bank on the same date for $1000.

  • 4. Repeat the previous step on the next available lines until you’ve entered the opening balances for each of your bank accounts.

If you’ve bank items entered in your previous system but have yet to clear your bank account, so that you can reconcile these once the appear on your statement, you should record these here on separate lines, using the date of the original transaction.

  • 5. Click Save.

You’ve now entered your bank opening balances which appear on your bank records and the relevant categories.

Enter your category opening balances

  • 1. Click Settings.
  • 2. Under Opening Balances, click Category Opening Balances.

This defaults to the date immediately prior to the one you entered in Accounts Start Date. You shouldn’t change this.

  • 3. Enter a reference for your opening balances.

If you’ve already entered your bank opening balances, the values automatically appear. If necessary, you can change these values by clicking the relevant line and following the steps in the sections above.

  • 4. Enter the remainder of your trial balance as follows:
Category * Choose the relevant category you want to record the opening balance for.
Details If required, enter any additional details.
Debit If the trial balance shows a debit value, enter this here.
Credit If the trial balance shows a credit balance, enter this here.
  • 5. Repeat the previous step on the next available line until you’ve entered all values from your trial balance.

As you enter your trial balance, to ensure the total debits and credits balance, the opposite entry posts to the Opening Balances category. Once you’ve entered all the values from your trial balance, this account should be zero. If it isn’t, check you’ve entered the correct values for each entry.

If necessary, you can save your opening balances without entering the full trial balance and Accounting Start retains the values you enter here. A value remains in the Opening Balances category until you can enter the full trial balance.

  • 6. Check the opening balances entered match those on your trial balance.
  • 7. Click Save.

You’ve successfully entered your opening balances and the values appear on the relevant categories.

To edit or delete an opening balance

  • 1. Click Settings.
  • 2. Under Opening Balances, click Bank or Category Opening Balances.
  • 3. Do one of the following:
  • To delete the opening balance, click the delete button . If prompted to confirm you want to delete the transaction, click Yes, and Save.
  • To edit a bank or category opening balance, change the relevant line as required, and Save.

If you change your opening balances, and this results in a difference between the debits and credits in the Category Opening Balances option, the difference posts to Opening Balances category (9998).

You should check the value for each item matches the values on the trial balance you’re using to enter your opening balances. If they don’t, before saving your opening balances, change any as required and check the balance on category 9998 is zero.