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Help with Reclassification

Hi,

 

I have my first client and I'm feeling overwhelmed. It's a school and they classified all of their transactions as Owner's Equity. My suggestion to them (I think) would be to have me reclassify each transaction properly, as an expense, income, etc.

 

My question...by reclassifying their entries, will this correct their balance sheets and other reports. I believe it would but I'm a newbie and want to be sure. 

 

Thank you!

Mena

Best answer 05-16-2019 01:26 PM

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Re: Help with Reclassification

Thats a terrible set of account for your first time through -
but YES, as you correct the prior entries those changes will immediately be reflected as revised financial report.
Unfortunately the error you describe indicates the person doing the entries had no clue - so I would expect will find lots more problems as you dig further...
2 Comments
Established Community Backer ***

Re: Help with Reclassification

Thats a terrible set of account for your first time through -
but YES, as you correct the prior entries those changes will immediately be reflected as revised financial report.
Unfortunately the error you describe indicates the person doing the entries had no clue - so I would expect will find lots more problems as you dig further...
Frequent Explorer *

Re: Help with Reclassification

Thank you MikeinBC! I'm a little nervous since this is my first client, but I'm reassured because you guys are such a supporting and helpful community!