Every accounting system is designed to ensure that all entries are balanced as they move into your general ledger. Even though the design and the software coding may be flawless, it is still possible for your system to get out of balance – where your debits do not equal your credits. What causes this to happen? A common cause is a power glitch or power failure that interrupts for stops during the posting process. Less likely, is a patch or update to software that was not fully tested.
How do you resolve it?
If you are doing the following monthly, you should know exactly when the out-of-balance situation began. If not, you will need to do this for previous months until you locate the month in which the error occurred. (Note: add this to your closing procedures if you have not already)
Print a Trial Balance – Use the out-of-the-box trial balance that was provided by the software publisher, rather that one that was customized by you. If the debits equal the credits, you know that your general ledger is in balance. There are three sets of numbers that must be equal:
- Opening(YTD) Debits and Credits
- Monthly Net Change Debits and Credits
- Closing (YTD) Debits and Credits
How do you fix an out-of-balance general ledger?
Here are two ways to correct an unbalanced journal entry:
- If your software allows, post an unbalanced journal entry through General Ledger for the account(s) and amount(s) that are missing from the original journal entry, or post an unbalanced journal entry through General Ledger to reverse the original journal entry, then do another journal entry for the full journal entry that should have been posted originally. **Note ** make sure you use the date of the original journal entry because you want it to update the same accounting month. Once all corrections are made, run the Trial Balance again to see if it in balanced.
- If there are no unbalanced journal entries but the month is still out of balance, this could be a damaged journal entry, or an opening balance is not reporting correct for just that month. Depending on your software, you may have file correction tools that will rebuild your transactional files. These File Rebuild Menu options typically reside in the Admin area with limited access. If they are not in your menu, check with your system administrator to gain rights to the tools or ask him to run them for you.
If these two alternatives do not resolve your out-of-balance situation, contact your software business partner. Of course, CS3 Technology can assist with all Sage 100 and Acumatica issues you may encounter.