How to Enter or Record Opening Bank Balance in QuickBooks?

It is really important to record opening balance in QuickBooks. When creating an account in your QuickBooks account, you can select a day in order to start tracking your transactions. Then, you can enter the bank balance account for the day you select. By doing so, your QuickBooks matches the bank records from the beginning.

This is the beginning stage of the opening balance of your account. Also, it helps you to summarize the past transaction that appeared before it. If you want to know more in detail about how to record the opening balances for a bank account in QuickBooks, we will help you out.

How to Record Opening Balance in QuickBooks Desktop?

To record the opening balance for the accounts you are creating, first, you need to enter the opening balance and then check the opening balance entry in QuickBooks Desktop.

Step 1: Add the Opening Balance

To enter the opening balance, you are required to create a bank account and then enter the opening balance. Thereafter, you can check the entry of the opening balance to make sure it is accurate.

Create the Credit or Bank Account

Before creating a new bank account in QuickBooks, users should be aware of what to record for the opening balance. You can enter the opening balance for the account you had for a while or for the real bank account you just created.

• First of all, get the bank statements or log in to the bank’s website.
• Open “QuickBooks Desktop”.
• Navigate through the “Company” menu.
• Then, click on the “Chart of Accounts” option.
• Now, click right anywhere on the “Chart of Accounts” screen.
• Click on the “New” button.
• Choose “Credit Card” or “Bank” for the account type.
• Hit the “Continue” button.
• Enter the name of the account. In case you are having multiple accounts at the same bank or the same type then you should provide unique names. This will be easier for you to recognize the accounts.
• Fill in the remaining data fields.
• Click on the “Enter Opening Balance”. If required you can edit the opening balance then you can use the “Change Opening Balance” button.

Enter the Opening Balance

After creating the bank account, you can enter the opening balance. Remember that entering the details as an opening balance depends on how you handle past transactions. Let us be aware of the following instructions.

If you are not planning to add the old transaction that appeared before the date of opening balance in QuickBooks then you just need to do the following:

• Add the ending date and ending balance from the latest bank statement.
• Hit the “OK” button.

This will summarize all the past transactions. Thereafter, you can easily track the new transactions.

But, if you are planning to enter the past transactions in QuickBooks then you can perform the following steps:

• First of all, plan how far you want to go back.
• Then, choose the date that is older than your oldest transaction that you wish to track. The opening balance helps you to summarize before the date you select.
• In the “Ending date” field, add the date you select.
• Now, in the “Ending Balance”, enter your balance of the real-life account for that particular date.
• Hit the “OK” button. This way you can prevent yourself from counting the past transactions twice.
• Click the “Save & Close” button. This will record your opening balance.

This is how you can create a new bank account and record your opening balance in QuickBooks Desktop. If required, you can also add the opening balance for the liability, asset, and other types of accounts.

Step 2: Check the Entry of Opening Balance

After entering the opening balance, it is important to check the account register if it is accurate. Also, make sure that your Opening Balance Equity account should not have the remaining balance.

To determine this, you can do the following:

• Click on the “Lists” menu.
• Then, click on the “Chart of Accounts” option.
• Look for the “Opening Balance Equity” account and open it.

If the balance is not 0.00 then you just need to write down your remaining balance. Thereafter, you can run the Balance Sheet Report for the previous year.

• Click on the “Reports” option.
• Now, hover over the “Company & Financial” option.
• Choose the “Balance Sheet Standard”.
• Pick the “Last Fiscal Year” using the “Dates” drop-down menu.
• Mark the “Retained Earnings” balance in the “Equity” section.

Now, you can compare the Retained Earnings balance of the last year with the remaining balance available in the Opening Balance Equity account. If the balance is matched then the data is balanced. But, if it does not match then you should contact your accountant.

How to Record Opening Bank Balance in QuickBooks for Other Types of Accounts?

Users can also enter the opening balance for other types of accounts on the Balance Sheet. But, you have to be very careful entering the opening balance for a few accounts such as Equity, Fixed Asset, Current Asset, other Assets, Long-term Liability, and other Current Liability accounts.

If you find any difficulties then you can take help from the following steps:

• First of all, get the bank statements or log in to the bank’s website.
• Open “QuickBooks Desktop”.
• Go to the “Company” menu.
• Then, click on the “Chart of Accounts” option.
• Now, click right anywhere on the “Chart of Accounts” screen.
• Click on the “New” button.
• Choose “Loan, Fixed Asset, or Equity”. For other accounts, you can click on the “Other Account Types” drop-down menu.
• Hit the “Continue” button.
• Enter the name of the account. In case you are having multiple accounts at the same bank or the same type then you should provide unique names. This will be easier for you to recognize the accounts.
• Fill in the remaining data fields.
• Click on the “Enter Opening Balance”. If required you can edit the opening balance then you can use the “Change Opening Balance” button.

Remember that entering the details as an opening balance depends on how you handle past transactions. Check out the following instructions.

If you are not planning to enter the old transaction that appeared before the date of opening balance in QuickBooks then you just need to do the following:

• Add the ending date and ending balance from the latest bank statement.
• Hit the “OK” button. This will summarize all the past transactions. Thereafter, you can easily track the new transactions.

But, if you are planning to enter the past transactions in QuickBooks then you can perform the following steps:

• First of all, plan how far you want to go back.
• Then, choose the date that is older than the oldest transaction that you wish to track. The opening balance helps you to summarize before the date you select.
• In the “Ending date” field, add the date you select.
• Now, in the “Ending Balance”, enter your balance of the real-life account for that particular date.
• Hit the “OK” button. This way you can prevent yourself from counting past transactions twice.
• Click the “Save & Close” button. This will record your opening balance.

This will save all your details for the account depending on the type you are selecting. Thereafter, you can check the opening balance entry to ensure that the account register is accurate.

How to Record Opening Balance Equity in QuickBooks Online?

Opening balance can be recorded for accounts that are not connected to online banking. If you are not planning to connect the account then you can enter the opening balance manually.

Remember: For the opening balance, users should know the amount to enter. You can enter the opening balance for the account you had for a while or for the real bank account you just created.

To enter the opening balance in QuickBooks Online, you can follow the steps stated below:

• Click on the “Settings” icon.
• Go to the “Chart of Accounts” option.
• Click the “New” button.
• Enter the name of the account. Also, choose the “Detail Type” and “Account Type”.
• Add other information, for example, the default tax code.
• Now, select when you would like to start tracking the finances.
• Then, enter your amount in the “Balance” field and also determine the “As of” date. Make sure you enter today’s date if you wish to start tracking immediately.
• Hit the “Save and Close” button.

Once done following these steps, you can track your new transaction that appears after the date of the opening balance.

Winding Up

It is easy to record opening balance in QuickBooks Online and Desktop. All you are required to create a bank account and enter the opening balance. Thereafter, you can check if the opening balance entry is accurate. Besides that, we have talked about recording opening balances for other types of accounts such as Equity, Fixed Asset, Current Asset, other Assets, Long-term Liabilities, and other Current Liabilities accounts.