Opening Balances in the Nominal Ledger
The task of entering Nominal Ledger opening balances has two stages. First, it is recommended that you enter balances for each Account as they stood at the end of the previous fiscal year. Use the
Brought Forward Balances setting for this task. This information should be available on the Trial Balance report obtained from your old system. The second stage, applicable only if you are changing to FirstOffice in the middle of a financial year, is to enter the Transactions for the current year to date, using the
Transaction register.
In considering Account balances for the current year to date, the following options are available:
- the minimum is to enter a balance for each Account as a single figure;
- the opposite extreme is individually to enter all Transactions raised so far in the current fiscal year;
- a compromise route to reduce the amount of work required is to enter monthly Account balances;
- a final option, available if you are changing to FirstOffice from an older computerised system, is to import the current year's Invoices and Receipts from a text file. Please refer to your local FirstOffice representative if you would like to consider this option.
If you decide to use option 1 or 3, you should copy the Account balances from Trial Balance reports printed from your old system.
The following section assumes you have already defined a Chart of Accounts and a set of VAT Codes.
If you need to enter Sales and Purchase Ledger opening balances, this must be done before entering Nominal Ledger opening balances. If you are not entering Sales and Purchase Ledger opening balances, follow the sequence below from step 3 onwards.
Once this has been done, follow these steps:
- Print out a Trial Balance report for the previous year. Please refer to this page for details about printing a Trial Balance report.
- You will probably find that the only Accounts showing balances are the Debtor, Creditor, Sales, Purchase and Bank and Cash Accounts. Compare these figures with those on the Trail Balance for the corresponding period produced from your old system. It is likely that the balances for the Debtor, Creditor, Sales and Purchase Accounts will match, and the Bank and Cash Accounts probably will not match. When entering opening balances, values should not be entered for these Accounts unless there is a difference between the two Trial Balance reports. If so, only figures representing that difference should be entered. This will ensure that a Trial Balance printed after the General Ledger opening balances have been entered will exactly match that produced from the old system.
! | Take great care when entering opening balances to the Debtor, Creditor, Sales, Purchase and Bank and Cash Accounts. Avoid posting the same amount twice (from the Sales or Purchase Ledger and from the Nominal Ledger). This will immediately render your accounts inaccurate. |
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- You are now ready to enter Account balances as they stood at the end of the previous financial year to the Nominal Ledger. Click the [Settings] button in the Master Control panel.
- Double-click 'Brought Forward Balances' in the 'Settings' list.
- Click [New] on the Button Bar.
- Enter the information as shown in the following illustration. Full details of the fields are to be found in the description of the Brought Forward Balances setting. It is recommended that you choose a Transaction Date that is at the end of the previous fiscal year and that is, in any case, prior to the date when you will be starting work with FirstOffice.
- The Brought Forward Balances screen does not have an OK check box, so Account Balances are updated as soon as the Balances are saved. Therefore, before clicking [Save], make sure that no mistakes have been made. One check is that the Debit and Credit totals are the same. If you discover a mistake at a later date, you will be able to correct the record without difficulty.
- Finish with [New] (or use the Ctrl-N/⌘-N keyboard shortcut) if you wish to enter more Balances.
- Finish with [Save] when you have entered the last Balance. Then, close the record using the close box.
- Close the 'Brought Forward Balances: Browse' window and then the 'Settings' list, in both cases by using the close box.
- Once you have entered all opening balances, print out a Trial Balance for the previous year and compare it with that obtained from your old system. Any discrepancies should be investigated immediately: any delay will make this more difficult.
If you are starting to use FirstOffice in the middle of a financial year, you should now enter the current year's Transactions.
As discussed earlier in this section, these can be entered as individual Transactions or Account balances. If you choose the former, enter the Transactions from the original documentation, and do not copy them from Transaction Journal reports produced from your old system. This will ensure that you do not enter any Transactions that relate to the Sales or Purchase Ledgers. If you choose the latter and you need to enter Sales and Purchase Ledger opening balances, these must be entered first.
Once this has been done, follow these steps. Again, if you are not entering Sales and Purchase Ledger opening balances, or if you are entering individual Transactions, follow the sequence from step iii onwards:
- Print out a Trial Balance report for the current year to date. Please refer to this page for details about printing a Trial Balance report.
- Again, as described in step 2 above, compare this report with the Trial Balance for the corresponding period produced from your old system. Where an Account has a balance, the figure entered should be the difference between the old Trial Balance amounts and the new Trial Balance amounts.
- Click the [Transactions] button in the Master Control panel.
- Click [New] on the Button Bar.
- Enter the information as shown in the following illustration. Full details of the fields are to be found in the description of the Transaction register. Ensure you use the same Transaction Date that was used when entering the Transaction to your previous system. If you are entering a single balance figure for each Account, the date should be the last date of use of your previous system.
- The Transaction screen does not have an OK check box, so Account Balances are updated as soon as the Transaction is saved. Therefore, before clicking [Save], make sure that no mistakes have been made. One check is that the Debit and Credit totals are the same.
- Finish with [New] (or use the Ctrl-N/⌘-N keyboard shortcut) if you wish to enter more Transactions.
You can use another feature when you need to enter several Transactions quickly in one sitting and don't want to interrupt your typing by reaching for the mouse. Enter the debits in a Transaction first and then, with the cursor in the Credit field in the final credit row, press the Return or Enter key twice. The first pressing causes FirstOffice to enter the correct credit amount to balance the entry for you. The second saves, closes and commits the Transaction to the Nominal Ledger and opens a new, empty, Transaction.
- Finish with [Save] when you have entered the last Transaction. Then, close the record using the close box.
- Close the 'Transactions: Browse' window and then the 'Settings' list, in both cases by using the close box.
- Once you have entered all Balances and Transactions, print out a Trial Balance and compare it with that obtained from your old system. Any discrepancies should be investigated immediately: any delay will make this more difficult.
