[Question] Opening balances

[LGripper]

Hi, I am working on Pastel Express and need to load opening balances (Debtors & Creditors) as well as all my General ledger accounts. It is a new set of books that I have just created and I just need some advice. Thanks

[Neville Bailey]

If you need to take on the opening balances of an existing business, you will need to have the following minimum information on hand - a trial balance (from your previous accounting system), a list of debtors and a list of creditors.

Here is an example of how to take on opening balances.

Let's assume that the trial balance is as follows:

	Debit	Credit
Sales		100,000.00
Expenses	75,000.00
Retained Income		50,000.00
Capital		50,000.00
Long Term Liabilities		200,000.00
Fixed Assets	300,000.00
Bank	20,000.00
Trade Debtors	20,000.00
Trade Creditors		15,000.00
TOTAL	415,000.00	415,000.00

You will notice that the total of the Debits is equal to the total of the Credits - that is important!

Now, assume that the breakdown of your Trade debtors is as follows:

Customer A - R15,000 Dr
Customer B - R5,000 Dr

And your Trade creditors is made up of:

Supplier A - R7,000 Cr
Supplier B - R8,000 Cr

You would create the following Opening Balance accounts in your new system:

- 9990/000 Opening balance account - Main account
- 9990/001 Opening balance account - General Ledger
- 9990/002 Opening balance account - Customers
- 9990/003 Opening balance account - Suppliers
- 9990/004 Opening balance account - Bank

Your journals would be as follows:

General journal:

	Debit	Credit
9990/001	100,000.00
Sales		100,000.00
Expenses	75,000.00
9990/001		75,000.00
9990/001	50,000.00
Retained Income		50,000.00
9990/001	50,000.00
Capital		50,000.00
9990/001	200,000.00
Long Term Liabilities		200,000.00
Fixed Assets	300,000.00
9990/001		300,000.00

Customer journal:

	Debit	Credit
Customer A	15,000.00
9990/002		15,000.00
Customer B	5,000.00
9990/002		5,000.00

Supplier journal:

	Debit	Credit
9990/003	7,000.00
Supplier A		7,000.00
9990/003	8,000.00
Supplier B		8,000.00

Cashbook Receipts journal:

Allocate R20,000 to 9990/004

If you look at the resulting balances for each of the 9990 sub-accounts, they will be as follows:

9990/001 - R25,000 Dr
9990/002 - R20,000 Cr
9990/003 - R15,000 Dr
9990/004 - R20,000 Cr

However, the net balance on the main account 9990/000 is zero - this will confirm that you have captured the opening balances correctly.

[Neville Bailey]

I forgot to mention that, if your opening balances are the closing balances for the previous financial year, then you need to process each of the above journals as Last Year journals, so that they reflect as opening balances for the current financial year.

For example, if the new financial year starts on 1 March 2011, and you have closing balances as at 28 February 2011 that you want to take on, then open each journal, go to the Settings button at the bottom, and untick the box named "This Year Transactions", then click on Close. You will then see the words "Last Year" in red at the bottom of the journal. Now, select period 12 of last year, and capture the entries there.

[LGripper]

Thank you

I cannot thank you enough for the prompt and clear advise, it is exactly what I was looking for.

[yonds]

Thank you Thank you................... THANK YOU THANK YOU THANK YOU WOW!!!!!!!!!!!!!!!!!!!! that really got me out of a messy situation. Thanks Mr Bailey

[Thato]

i have suspense in my trial balance

My name is Thato I work as finance and admin assistant. I have just captured the opening balances for a new company so i have suspense, please help,

[Neville Bailey]

My name is Thato I work as finance and admin assistant. I have just captured the opening balances for a new company so i have suspense, please help,

Either you have captured opening balances from a trial balance that does not balance, or you have made a data capturing error, or you have missed/duplicated certain opening balances.

[VKus]

Thank you Neville, i have been struggling to adjust last year number so they appear as opening balance. You have sorted me. Thank you

[Holger]

Take On balances - Bank

I forgot to mention that, if your opening balances are the closing balances for the previous financial year, then you need to process each of the above journals as Last Year journals, so that they reflect as opening balances for the current financial year.

For example, if the new financial year starts on 1 March 2011, and you have closing balances as at 28 February 2011 that you want to take on, then open each journal, go to the Settings button at the bottom, and untick the box named "This Year Transactions", then click on Close. You will then see the words "Last Year" in red at the bottom of the journal. Now, select period 12 of last year, and capture the entries there.

Hi Neville
where do you process "Take On" balances for Bank? My understanding is that posting a opening balance into bank via a journal will not refelect in the bank recon?

[Neville Bailey]

Hi Neville
where do you process "Take On" balances for Bank? My understanding is that posting a opening balance into bank via a journal will not refelect in the bank recon?

Hi Holger,

You need to process either a cashbook payments journal (for an unfavourable opening balance) or a cashbook receipts journal (for a favourable opening balance) and allocate the transaction to the Suspense account.

[Natalie Forbes]

Neville I have followed this thread as I need to take on the balances in the cashbooks for the charity that I volunteer at. The problem is that "this years transactions" is greyed out in the cashbook settings. Is it because it's a new set of books and there are no previous years transactions? Where would I go to make the tick box functional? I am using Xpress.

[Neville Bailey]

Neville I have followed this thread as I need to take on the balances in the cashbooks for the charity that I volunteer at. The problem is that "this years transactions" is greyed out in the cashbook settings. Is it because it's a new set of books and there are no previous years transactions? Where would I go to make the tick box functional? I am using Xpress.

Hi Natalie,

I assume that the batch is empty? The "This Year Transactions" box will grey out if there are entries in the batch.

The other possible reason for the box being greyed out is that you might be logging on without supervisor access rights, or your user profile has disallowed you to process prior year transactions. Can you access the Setup...Users/Passwords menu?

[Mike C]

Hi Natalie - I have quoted some of Neville's earlier post here just to help.

If the new financial year starts on 1 March 2014, and you have closing balances as at 28 February 2013 that you want to take on, then open the General Journal, go to the Settings button at the bottom, and untick the box named "This Year Transactions", then click on Close. You will then see the words "Last Year" in red at the bottom of the journal. Now, select period 12 of last year, and capture the entries there using ledger account 9990/000 "Take on Balances"

Could it be that you went to the Cash Book rather than the Journals and opened "Settings"? If that is so, then the reason why "This years transactions" is greyed out is because the cash book is already ready to accept info for this year.

[JoyceSivha]

Hi Neville we just bought pastel and the Co did not have a system so i am capturing each customer\suppliers opening balances using the statement of the last month of the last financial year? is this ok?

[Zahz]

Need help with take on opening balances

Hi guys, I'm new to pastel and need help on how to do the take on balance for my new company

My activity says - create 4 sub accounts required for take on opening balances

I have created
Suppliers -9990-003
Customers- 9990-002
Inventory- 9990 -sub account 004
General ledger 9990-sub account 001

The next step says ' process but do not update the general journal to take on the trial balances using the appropriate opening balance sub accounts

Trial balance
31 July 2016

Retained income - CR 299673,04
Share capital - CR 1 500 000
Land and building cost- DR 1 000 000
Computer equip cost- DR 55000
Computer equipment accum depr - CR 32670
Furniture cost - DR 48570
Furniture accum depr - CR 8742,60
Training equip - DR 1000000
Training equip accum depr - Cr 45000
Current account - Dr 296256,06
Petty cash- Dr 8300
Inventory control - Dr 312 600
Customer control - Dr 430 040.20
Supplier control - Cr 349 698,87
Vat control - Cr 14 981,75

The DR and CR balances

How do I go about doing this on Pastel?

Next step says print the journal without contras

Update th journal bath

Looking forward to your help

Thanks