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Mr Tangerine Man
Level 3

Opening Balances

I am wanting to start using QBO from 1 April for all transactions but (other than bank balances) won't know the opening balances until the old year accounts (pre QBO) have been balanced and closed off in a few weeks time. How best to handle this please?

Solved
Best answer March 31, 2023

Accepted Solutions
GeorgiaC
QuickBooks Team

Opening Balances

Hi Mr Tangerine Man, thanks for posting on the Community. You can enter opening balances after you've already created an account to track transactions using a journal entry. To do this: 

 

1. Select + New > Journal entry.
2. Enter a date that comes before the oldest transaction in the account. This will be the opening balance date.
3. In the first row under the Account column, select the dropdown menu to choose the account you want to enter the opening balance for.
4. Add a note in the Description field so you know what the journal entry is for.
5. In the second row under the Account column, select the dropdown and choose Opening Balance Equity or Retained profit balance forward.
6. Use your bank statements or reports to enter the opening balance.
7. Enter the debits and credits based on the type of account you entered on the first line.
- Asset (savings and checking) and expense accounts: Enter the opening balance in the Debit column in the first row. Then, enter the same amount in the Credit column in the second row.
- Liability, equity, and income accounts: Enter the opening balance in the Credit column in the first row. Then, enter the same amount in the Debit column in the second row.
- Accounts Payable: In the first row in the Name field, select the supplier you owe money to. Enter the opening balance as a credit to increase the balance. Or enter the opening balance as a debit to decrease the balance. Then, enter the same amount in the opposite column in the second row.
- Accounts Receivable: In the first row in the Name field, select the customers who owe you money. Enter the opening balance as a debit if you want to increase the balance. Or enter the opening balance as a credit if you want to decrease the balance. Then, enter the same amount in the opposite column in the second row.
8. When you're ready, select Save and close.

 

After this, you'll need to mark the journal entry as reconciled to prevent it showing up in future reconciliations. Here's how:

 

1. Go to Bookkeeping and select Chart of accounts.
2. Find the account and select Account history from the Action column.
3. Search for the journal entry you just created. Select it to expand the view.
4. Select the box in the tick column until you see an R. This reconciles the journal entry.
5. When you're done, select Save.

View solution in original post

2 REPLIES 2
GeorgiaC
QuickBooks Team

Opening Balances

Hi Mr Tangerine Man, thanks for posting on the Community. You can enter opening balances after you've already created an account to track transactions using a journal entry. To do this: 

 

1. Select + New > Journal entry.
2. Enter a date that comes before the oldest transaction in the account. This will be the opening balance date.
3. In the first row under the Account column, select the dropdown menu to choose the account you want to enter the opening balance for.
4. Add a note in the Description field so you know what the journal entry is for.
5. In the second row under the Account column, select the dropdown and choose Opening Balance Equity or Retained profit balance forward.
6. Use your bank statements or reports to enter the opening balance.
7. Enter the debits and credits based on the type of account you entered on the first line.
- Asset (savings and checking) and expense accounts: Enter the opening balance in the Debit column in the first row. Then, enter the same amount in the Credit column in the second row.
- Liability, equity, and income accounts: Enter the opening balance in the Credit column in the first row. Then, enter the same amount in the Debit column in the second row.
- Accounts Payable: In the first row in the Name field, select the supplier you owe money to. Enter the opening balance as a credit to increase the balance. Or enter the opening balance as a debit to decrease the balance. Then, enter the same amount in the opposite column in the second row.
- Accounts Receivable: In the first row in the Name field, select the customers who owe you money. Enter the opening balance as a debit if you want to increase the balance. Or enter the opening balance as a credit if you want to decrease the balance. Then, enter the same amount in the opposite column in the second row.
8. When you're ready, select Save and close.

 

After this, you'll need to mark the journal entry as reconciled to prevent it showing up in future reconciliations. Here's how:

 

1. Go to Bookkeeping and select Chart of accounts.
2. Find the account and select Account history from the Action column.
3. Search for the journal entry you just created. Select it to expand the view.
4. Select the box in the tick column until you see an R. This reconciles the journal entry.
5. When you're done, select Save.

Mr Tangerine Man
Level 3

Opening Balances

Thank you 

Sounds complex but hopefully will fall into place when I attempt it.

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