Opening Unpaid Transactions

This guide shows you how to enter opening unpaid Sales and Purchases ready for future payments. This help item is relevant to companies migrating where they have unpaid sales or purchases relating to their previous tax periods (that had been entered into their previous accounting system or software).

In this example we will add a Purchase that we hadn’t paid prior to migration.

Capture Your Unpaid Purchases/Sales

  1. From the main menu, click the add icon for a Purchase/sale.
  2. Enter the date and number you used for the Purchase in your old accounting system or if you are using a new numbering system you might want to refer to the old Purchase number in the summary.
  3. Enter the remainder of the transaction as you would normally.
  4. For the Account select Equity: Historical Balancing and select the appropriate tax code for each line item.
  5. Enter the amount inclusive of any tax and save the transaction.

Update the Opening Balances

Assuming you have previously entered opening balances:

  1. Go to the opening balances.
  2. Choose Main Menu > Accounts > Opening Balances.
  3. Reduce the Liability: Accounts Payable amount by the total amount of the invoice(s) just entered for Purchases, or the Asset: Accounts Receivable for Sales
  4. Reduce the Tax Paid on Purchases entry by the total amount of any tax in the invoice(s) just entered.

If you enter in opening balances at a later date, you will need to subtract all invoices entered prior to the opening balance date (as described above) from the appropriate entries on the Opening Balance screen.

Check your entries

  1. We have created a Purchase which you will be able to record payment for once paid. Check the Purchases or Sale report to ensure the transaction is listed. The transaction is stored as unpaid until you apply a payment.
  2. If you have adjusted your opening balances, you may choose to view the Balance Sheet report as at the opening balance date of your file to ensure the Liability: Accounts Payable , Asset: Accounts Receivable and Asset: Tax Paid on Purchases Accounts have the correct balances according to the closing balances of your previous accounting system.


Why do I need to change my opening balances?

Your opening balance for the Liability: Accounts Payable Account is the sum total of all the outstanding Purchases that you owe people money for. When you enter an Invoice, the web finance engine creates hidden line item entries behind the scenes that allocate the correct amount to the Account. Subsequently, once you have entered all your unpaid Purchases then you may not need to enter an opening balance for the Liability: Accounts Payable Account.