What to do if you didn’t enter an opening balance in QuickBooks Online Leave a comment

I’m always around to provide the information that you need. Depending on the closing date you provide for your fiscal year, QuickBooks also automatically transfers the balance from your business’ other accounts to Retained Earnings on that date. However we also have a retained earnings account with zero balance. If you have any additional questions or require further clarification regarding the Opening Balance Equity in QuickBooks Online (QBO), please feel free to comment below, Norma.

Advice for cleaning up Opening Balance Equity in QB?

Your success with QBO is important to us, and we’re committed to providing the help you need to navigate the platform efficiently. Thank you for consistently engaging with us regarding your inquiries about the opening balance equity. I also appreciate the screenshot you’ve shared that shows the amount for this account in your Balance Sheet report. If your accounts still aren’t balanced, here’s how to fix opening balance issues.

QuickBooks, QB, TurboTax, Proconnect and Mint are registered

Click here for a free trial of the FreshBooks bookkeeping and accounting services now. All starting balances for balance sheet entries are automatically posted to the Opening Balance Equity (OBE) account. Then use a journal entry to transfer the OBE to the equity owner.

Enter opening balances for accounts in QuickBooks Desktop

To transfer retained earnings to partner’s equity, you can follow the sample entry provided by @Rustler above. As to why RE has a zero balance, that is hard to say from here. Having a negative balance would typically indicate the account is in the negatives. If you’re unsure of why, 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.

When setting up QuickBooks, you’ll input your company’s initial balances for accounts like cash, loans payable, and accounts receivable. OBE ensures these numbers are balanced, providing a clear and accurate snapshot of your business’ financial position. While there’s nothing to worry about, you can’t ignore it since it’s a temporary account you should close.

Credit card balance in Opening Balance Equity

If you have any additional questions or concerns regarding the Opening Balance Equity account or any other aspect of QuickBooks, please don’t hesitate to comment below, Norma. The QuickBooks Community is here to support you and provide guidance to help you make the most of this powerful accounting software. Together, we can work towards resolving any issues you may encounter and help you achieve your financial management goals. If you forgot to enter an opening balance when Certified Bookkeeper you created an account, don’t worry. You can go back later and create a journal entry to record it.

• Hence why I switch it, however QBO clearly doesn’t like it.
• If there is a balance in the account on that date, QuickBooks will record that balance with an offsetting entry to Opening Balance Equity.
• Let me know if there’s anything else I can help you with managing your downloaded bank transactions.
• No, the Opening Balance Equity (OBE) account is not meant for everyday transactions.
• The cause can hide in errors in the previous accounting period due to transaction misclassification, omissions, or calculation errors.

Customer or vendor balances in Accounts Payable and Accounts Receivable

• Each month the account will “reconcile” with the bank, however the Bank balance is way off from the QBO balance.
• From there, you’ll be able to view all the transactions and entries that are contributing to the current balance of the Opening Balance Equity account.
• Normally that credit books to income or sales or something because you made money, but when setting up a bank account that amount comes from the owners.
• In other words, it’s the first number you see when looking at your finances for a new period.
• This adjusts the OBE by the corresponding opening balance amount, either increasing or decreasing it to ensure your accounts remain balanced.

QB is double entry accounting, so for every entry there has to be an equal entry in a second account. A deposit in the bank is  a debit, so a credit has to book  somewhere. Normally that credit books to income or sales or something because you made money, but when setting up a bank account that amount contra asset account comes from the owners.

You add a new item to the chart of accounts

Want to always have accurate records in your QuickBooks? You might want to automate your accounting to eliminate errors, have your transactions opening balance equity categorized correctly and funds allocated properly. Book your seat at our Weekly Public Demo to see how you can do it with Synder, or explore it yourself with a 15-day all-inclusive free trial.