Advance to Employee not recorded

SL_110 · ‎June 12, 2026

When we moving to QBO we did not record the outstanding Advance in Pay. It was recorded as an expense showing a negative balance. Since this was not originally recorded as a current asset is it acceptable to Debit the Expense Account and Credit Opening Balance Equity as an adjustment entry noting that it is an adjustment entry. Or is there a better way to go about this without reversing the original transaction? We do not use the payroll function.

ZackE

Thanks for getting in touch with the Community, SL_110.

To properly identify how you should go about this and which accounts you might need to debit/credit, I'd recommend working with an accounting professional.

If you're in need of one, there's an awesome tool on our website called Find a ProAdvisor. All ProAdvisors listed there are QuickBooks-certified and able to provide helpful insights for driving your business's success.

I've also included a couple detailed resources about working with account and detail types, as well as journal entries, which you may find useful moving forward:

Please don't hesitate to send a reply if there's any additional questions. Have a wonderful Friday!

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Advance to Employee not recorded

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