Entering Opening Balances

Unless you are starting a new business and intend to use Standard Accounts to administer your accounts from the first day, you will need to enter some opening balances. If you are starting to use Standard Accounts at the beginning of the fiscal year, these opening balances will take the form of the closing balances for each Account for the end of the previous year. If you are starting to use Standard Accounts in the middle of the fiscal year, there will be two components to opening balance figures: the closing balances for each Account for the end of the previous year and Account balances for the current year to date.

To carry out this task, you should equip yourself with as much information as you can in the form of transaction data and reports produced by the old system, in order to make this task as easy as possible.

We recommend that you change during a current fiscal year. You should enter Account balances for the previous year and then enter individually all current year transactions registered so far. This will a) make you familiar with Standard Accounts, and b) automatically give you a check of the old transactions.

Before you can enter any opening balances, you should have specified the current and, if appropriate, previous fiscal years using the Fiscal Years setting and entered the Chart of Accounts and VAT Codes you wish to use. If you created your database using the 'Start with standard chart of accounts' option as described on the Starting any Standard product - New Installation page, it will contain the sample Chart of Accounts supplied with Standard Accounts. If this is not suitable, you can import your own chart from a text file or enter it manually.

Once you have entered your Fiscal Year, Chart of Accounts and VAT Codes, it's a good idea to enter all the opening balances at once. Ideally, this process should be completed before you start to enter new Transactions, but it is possible to change the opening balances at any time during the fiscal year.

When entering opening balances, the level of detail is up to you. Factors influencing this decision may be the number of Transactions, the time available to enter these Transactions, whether you can import them (otherwise, you will have to enter them manually) and the level of detail required in your reports. It might be that you enter or import all Transactions individually (in the form of Invoices, Receipts, Purchase Invoices, Payments and Nominal Ledger Transactions) or it might be that you enter a single opening balance for each Account. Full details covering the necessary data entry processes follow in the next sections.

Once you have entered your opening balances in their chosen form, print the reports you usually use and compare them with the reports from your old system. These reports should include the Trial Balance, Profit & Loss and Balance Sheet, and lists of Debtors and Creditors using the Sales Ledger and Purchase Ledger reports respectively.

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Opening Balances in the Nominal Ledger

In the Nominal Ledger, the task of entering opening balances can have two stages:
  1. You should enter balances for each Account as they stood at the end of the previous fiscal year. Use the Transaction register for this task. This information should be available in the Trial Balance report obtained from your old system.

    You can enter a single opening balance figure for each Account, or you can divide the opening balance figure into individual postings. This decision may depend on the Account itself.

  2. If appropriate, enter the Transactions for the current year to date, again using the Transaction register.
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.

The following sections assume you have already defined a Chart of Accounts and a set of VAT Codes.

To enter Account balances as they stood at the end of the previous fiscal year to the Nominal Ledger using the Transaction register, follow these steps:

  1. Select the Nominal Ledger module using the [Module] button in the Master Control panel or the ⌘-0 keyboard shortcut.

  2. Click the [Transactions] button in the Master Control panel to open the Transaction register.

  3. When the 'Transactions: Browse' window opens, click [New] on the Button Bar to open a new record.

  4. Enter the information as shown in the following illustration. Full details about the fields are to be found in the description of the Transaction register. 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 Standard Accounts.

    If you are entering a single opening balance figure for each Account, use each row in the grid to enter these balances, taking the figures from the Trial Balance report produced by your old system. If you are entering opening balances as individual postings, enter each posting on a separate row. You can enter single opening balance figures for some Accounts, and individual postings for others. For example, you can enter previously unreconciled postings to your Bank Account(s) individually, so that you can reconcile them with your bank statement later. Please refer to the description of the Account Reconciliation registerfor details about reconciling postings with your bank statement.

  5. The Transaction screen has 300 rows, allowing you to enter opening balances for up to 300 Accounts in a single record. If you need to enter a significant number of opening balances, you may want to do so using a number of Transaction records. This may be because 300 rows is not sufficient, or it may be because you may want to save your work periodically, by clicking the [Save] button in the top right-hand corner.

    When you save a Transaction, Account Balances will be updated immediately. Therefore, you will not be able to change a saved Transaction, hence the need to create a new record after saving.

    A Transaction record has to balance for you to save it, so each time you need to save, you can make a balancing posting to a temporary balancing Account as shown in the illustration above.

    If you discover a mistake at a later date, you will be able to correct the record using one of the correction features.

  6. Finish with [Save] when you have entered the last balance, and close the window by clicking the close box. Immediately on saving, the Transaction will update the balances of each Account.
If you are starting to use Standard Accounts in the middle of a fiscal year, you should now enter the Transactions for the current year so far. You should enter these from the original documentation, 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 your Sales or Purchase Ledgers. These will be entered later. Follow these steps:
  1. Using the [Module] button in the Master Control panel, ensure you are still in the Nominal Ledger.

  2. Click the [Transactions] button in the Master Control panel to open the Transaction register.

  3. When the 'Transactions: Browse' window opens, click [New] in the Button Bar to open a new record.

  4. Enter the information as shown in the following illustration. Full details about 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.

  5. The Transaction screen does not have an OK check box, so Account Balances are updated as soon as you save the Transaction. Therefore, before saving the Transaction, make sure that no mistakes have been made. One check is that the Debit and Credit totals are the same. Once you have saved the Transaction, you will not be able to change it.

  6. Click the [Save] button (or use the Shift-Enter keyboard shortcut) to save the Transaction. Alternatively, if you click the [New] button (or use the ⌘-N keyboard shortcut), the Transaction will be saved and closed, and a new empty record will be opened, allowing you to enter another Transaction.

    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 the correct credit amount to be entered for you, balancing the entry. The second saves, closes and commits the Transaction to the Nominal Ledger and opens a new, empty, Transaction.

  7. Finish with [Save] when you have entered the last Transaction, and close the window by clicking the close box.
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Sales Ledger Opening Balances

It is worth repeating that there can be two components to Sales Ledger opening balance figures: the final Customer balances from the previous fiscal year and, if you will be starting to use Standard Accounts in the middle of a fiscal year, Customer balances for the current year to date.

When considering Customer balances from the previous year, you only need to take account of those that are open (i.e. unpaid). You can enter these in one of two ways:

In considering Customer balances for the current year to date, the following options are available:
In deciding which procedure to use, one factor to consider is credit control. If you need to produce statements that itemise and age previous Invoices, it will not be enough simply to enter a total balance for each Customer. Instead, you will need to enter individual Invoices and Receipts. If, however, you do not issue statements or it is acceptable for a single opening balance figure to appear on your statements, entering a single opening balance figure per Customer will be sufficient. If you do not issue Invoices or you do not give credit (i.e. if your business is wholly cash-based), you may not need to enter any Sales Ledger opening balances at all.

If you need to enter Sales Ledger opening balances, you should first ensure that you have entered your Customers in the Contact register. If you are entering individual Invoices, you should also ensure that you have entered the Items that you sell in the Item register. Depending on your old system, you may be able to import this information from text files. Finally, if you are entering Receipts in any form (i.e. individual Receipts, or monthly or year-to-date Receipts) make sure you have entered all relevant Payment Modes (i.e. payment methods), so that you can post the Receipt amounts to the correct Bank or Cash Account.

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Sales Ledger Opening Balances - Nominal Ledger Settings

You should enter Sales Ledger opening balances in the form of Invoices and Receipts. Any Invoices and Receipts from the previous fiscal year that you enter should not be posted to the Nominal Ledger if you have already entered previous-year Nominal Ledger opening balances as described here. The Nominal Ledger opening balances include balances for the Accounts affected by Invoices (e.g. the Debtors Account) and so to post to those Accounts from opening balance Invoices is to post the same amounts twice. Therefore, before you can enter your Sales Ledger opening balances, you need to ensure that Invoices and Receipts from the previous fiscal year will not update the Nominal Ledger.

Using the [Module] button in the Master Control panel, ensure that you are in the Nominal Ledger. Click the [Settings] button, also in the Master Control panel, or use the ⌘-S keyboard shortcut. In the subsequent list, double-click 'Sub Systems'. The following window appears:

Specify by clicking the check boxes the records ("Sub Systems") that will update the Nominal Ledger automatically. In the illustration, for example, approving (marking as OK and saving) an Invoice dated later than 1/1/2011 will cause a Nominal Ledger Transaction to be created, debiting a Debtor Account and crediting a Sales Account and, if appropriate, a VAT Account. If the Invoice is dated earlier than 1/1/2011, a Nominal Ledger Transaction will not be created and so the Nominal Ledger will not be updated.

It is recommended that for each Sub System you enter the first day of your fiscal year. When you enter previous-year opening balances, use a date prior to the Sub System date. This will ensure that Nominal Ledger Transactions will be created when expected and that they will not be created for opening balances. If it takes longer than expected to enter opening balances, you can continue doing so and start to create new records without needing to worry about the consequences in the Nominal Ledger. For example, you can enter previous-year Invoices and Receipts (dated prior to the dates in the Sub System setting) at the same time as issuing new Invoices. The Sub Systems setting will ensure the Nominal Ledger is only updated when it should be.

If you are starting to use Standard Accounts in the middle of a fiscal year, you should already have entered the Nominal Ledger Transactions for the current year so far, as described on the Opening Balances in the Nominal Ledger page. If, as was recommended, you entered these from the original documentation and did not copy them from Transaction Journal reports produced from your old system, you will not have any current year Transactions that relate to your Sales or Purchase Ledgers. These will now be created automatically from the Invoices and Receipts (and Purchase Invoices and Payments) that you are about to enter, providing that they are dated later than the Sub System date (the first day of your fiscal year). If you did enter current year Transactions relating to your Sales or Purchase Ledgers as part of the previous exercise, you will not want them created again when you enter Invoices and Receipts. In this case, make the Sub System date later (a few days before the date when you will start originating transactions in Standard Accounts). This means you will be able to enter Invoices for the current year to date and to issue new Invoices simultaneously without needing to worry about the consequences in the Nominal Ledger.

If you are not certain whether you have entered current year Transactions relating to your Sales or Purchase Ledgers, produce a Trial Balance report for the current year and check the balances for your Sales, Purchase, Debtor and Creditor Accounts. If these are zero, you have not entered these Transactions. If they are the same as those on the Trial Balance produced from your old system, you have entered these Transactions already. Please refer to the Printing Reports page for instructions about printing a Trial Balance report.

Once the Sub Systems setting is to your satisfaction, save and close the window by clicking [Save] in the Button Bar.

!

Note that if you have entered previous-year opening balances in the Nominal Ledger, you should not post any Sales or Purchase Ledger opening balances to your Nominal Ledger. To do so will duplicate the work you have already done and will immediately render your accounts inaccurate.


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Sales Ledger Opening Balances - Sales Ledger Settings

Before entering the first opening balance, there is a single setting in the Sales Ledger that you need to check if you will be entering Receipts for the fiscal year to date.

Use the [Module] button in the Master Control panel to enter the Sales Ledger and click the [Settings] button, also in the Master Control panel. In the subsequent list window, double-click on 'Payment Modes'.

Payment Modes represent the different methods that your Customers will use to pay your Invoices and you will use to pay your Suppliers. Typical examples are cash, cheque, direct debit and credit card. If necessary, each Payment Mode can debit a different Account, to represent payments into different bank accounts, into petty cash or by credit card.

If you created your database using the 'Start with standard chart of accounts' option as described on the Starting any Standard product - New Installation page, you will have imported the sample Chart of Accounts supplied with Standard Accounts to your database. You will also have imported some basic Payment Modes. If you have modified the Chart of Accounts supplied, or you have created your own, ensure that the Account Numbers shown in the second column now refer to the correct Account (remember, you can use 'Paste Special' if necessary).

To create a new Payment Mode, simply click in the first blank row and enter a unique Code. Then enter the other details as appropriate, referring here if necessary to complete the entry.

Click [Save] when you have finished.

Then, close the 'Settings' list using the close box.

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Sales Ledger Opening Balances - Opening Balances

The process described below applies to the entering of opening balances both from the previous fiscal year and for the current year to date.

You are now ready to enter the first Invoice. Follow the steps described below. If you are entering a single opening balance figure per Customer, either for the previous fiscal year or for the current year to date, you will need to do this by entering it in an Invoice. If so, omit step 7 in the following procedure. Do this:

  1. If you are not already in the Sales Ledger, move into it using the [Module] button in the Master Control panel.

  2. Click the [Invoices] button in the Master Control panel or use the ⌘-1 keyboard shortcut to open the Invoice register.

  3. When the 'Invoices: Browse' window opens, click [New] in the Button Bar to open a new record.

  4. When the 'Invoice: New' window opens, the Invoice and Transaction Date fields will both contain the current date taken from the system clock.

    If you are entering a single opening balance figure for each Customer, you might like to use a separate numbering sequence for opening balances (use the Number Series - Invoices setting in the Sales Ledger to set up numbering sequences). If you are entering individual Invoices, you will need to use the Invoice Number and Date of the original Invoice.

  5. Place the insertion point in the Customer field and activate the 'Paste Special' feature using the ⌘-Enter keyboard shortcut. The 'Paste Customer' window appears, showing a list of the Customers recorded in the Contact register. Select a Customer by clicking on its row and pressing the Return key twice. The first pressing causes the Customer Number to be transferred to the field in the Invoice, and the second will move all information about the Customer (Name, Address etc.) to the Invoice.

  6. Use the Tab or Return key to move the insertion point to the Date field. In the case of Customer balances from the end of the previous fiscal year, ensure that this is set to a date that is earlier than the cut-off date you specified in the Sub Systems setting.

  7. If you are entering individual Invoices, move the insertion point to the Item field and press ⌘-Enter again. Select the correct Item from the list and press Return twice. The insertion point is moved to the Qty field. Enter the number of items sold, and press Tab or Return. Check that the Unit Price is correct and repeat for each item on the Invoice.

  8. If you are entering single opening balances, do not enter an Item Number as described in step 7 and instead move the insertion point to the Qty field and enter a quantity of 1. Press Tab or Return and enter the text "Opening Balance" in the Description field. Enter an amount (excluding VAT) in the Unit Price field.

  9. Until you are familiar with the Invoice screen, it is a good idea to check that every field is correct. Clicking the named tabs marked 'Terms', 'Items' and 'Address' causes different information about the Invoice to be shown. Pay particular attention to the VAT Code field: its default is taken from the Item record or, if not specified there, from the Account Usage S/L setting. It will be the latter in the case of single opening balances, as then you are not referring to the Item register.

  10. At the bottom of the Invoice the total is shown, together with the VAT amount and the total payable amount.

  11. Click [Save] to save the Invoice.

    The window title changes to 'Invoice: Inspect'. You can now correct any mistakes before you click the OK check box in the bottom left-hand corner. With the OK box checked, clicking the [Save] button once again approves the Invoice and commits it to your Sales Ledger. After this you may not change the individual fields. You must approve Invoices before you can allocate Receipts to them and for them to appear in the Sales Ledger report and the Periodic Customer Statement.

  12. Finish with [New] if you wish to enter another Invoice. Or, if you are entering all Invoices for the current fiscal year, click [Duplicate]. This will create a new Invoice which will be a copy of the one just saved. This will save you having to enter Customer details, etc, again if they are the same.

  13. Finish with [Save] when you have entered the last Invoice, and close the window by clicking the close box.
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Sales Ledger Opening Balances - Entering Receipts

As with entering Invoices, you can get a lot of help with entering your Receipts using the shortcuts built in to Standard Accounts. Perhaps the most useful tool is the 'Paste Special' command. You can use 'Paste Special' whenever you enter data in a field that refers to another register or setting.

There is no need to enter any Receipts from the previous fiscal year, because you should only have entered outstanding Invoices from that year. You should only follow the steps described below for Receipts from the current year to date (i.e. only if you are starting to use Standard Accounts in the middle of a fiscal year).

  1. Open the 'Receipts: Browse' window by ensuring you are in the Sales Ledger and clicking the [Receipts] button in the Master Control panel.

  2. When the 'Receipts: Browse' window opens, click [New] or use the ⌘-N keyboard shortcut to open a new record.

  3. The 'Receipt: New' window is shown. You can use a single window to enter all your Receipts from the earlier part of the year, providing that they use the same Payment Mode (i.e. post to the same Bank or Cash Account).

  4. Enter the data in the top of the window. Select a Payment Mode using 'Paste Special' to open a list of the Payment Modes you created earlier. Make sure the Transaction Date is correct.

  5. For each Receipt, enter the Invoice Number in the first column (or use 'Paste Special' to choose from a list of unpaid Invoices) and press the Return key.

  6. If you have an Invoice that is part-paid, alter the Received Value field to show the amount paid.

  7. When you have entered every Receipt, you should check what you have entered. If you find any errors you can change them as needed. When you are satisfied, click the OK check box in the lower left-hand corner.

  8. When you click [New] or [Save], the Receipt is approved and after this may not deleted or changed.
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Purchase Ledger Opening Balances

When entering Purchase Ledger opening balances, you should follow the same basic decisions and procedures described on the Sales Ledger page, using the Purchase Invoice and Payment registers. Before entering opening balances, use the Sub Systems setting in the Nominal Ledger to make sure that your previous year Purchase Ledger opening balances will not be posted to the Nominal Ledger, as described here.

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Printing Reports

You can produce many different reports from Standard Accounts. Detailed descriptions of each report can be found in the appropriate sections of these web pages, beginning here. You should, however, always print a Transaction Journal for the Transactions entered during one work session. The same goes for the Invoice Journal in the Sales Ledger.

Having completed the process of entering your opening balances, you should now print a Trial Balance and compare it with a Trial Balance produced from your old system.

To print a Trial Balance, follow these steps:

  1. Ensure you are in the Nominal Ledger module using the [Module] button in the Master Control panel and click the [Reports] button in the Master Control panel. You can also use the ⌘-R keyboard shortcut.

  2. The 'Reports' list opens, showing the reports that you can produce from the Nominal Ledger:

  3. Choose 'Trial Balance' by double-clicking. You can also type the first few characters of the name of the report ("trial" for example) and then press the Enter or Return key. The 'Specify Trial Balance' window appears.

  4. To report on your opening balances, you should enter in the Period field a period from the beginning of the current fiscal year to the current date. Separate the start and end dates of this period using a colon (:), as shown in the illustration. You can leave all the other fields blank, ensuring that all Accounts etc will be included in the report.

  5. Use the Media options at the bottom of the window to choose a print destination (for example, 'Printer' or 'Screen'), and click the [Run] button to produce the report.

  6. If you printed to screen and now wish to print on a printer, simply click the Printer icon in the Button Bar of the report window.
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