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Balancing Financial Statements

BALANCE SHEET: 

To verify that all Balance Sheet GL Account numbers are assigned to a financial statement table line number go to General Ledger – Listings – Chart of Accounts and add to the Report Main the Table “#” Line # item that corresponds to the financial statement table used to print the balance sheet.  If you cannot identify the Balance Sheet account number causing the out of balance issue using this report then you will need to go through the following steps:

 

1.  Print the Balance Sheet and make note of the total amount of Assets, total amount of Liabilities and the Current Year Net Income that is printing.

 

2.  Bring up the Trial Balance and enter the date range that you are printing the balance sheet for.  Make sure you are printing in Summary.   In the first section on your screen called "Account Type" enter a number 1 and print.  The ending balance should agree with the Total Assets on the Balance Sheet.  If they do not agree calculate the difference and see if there is an account on your Trial Balance that equals that amount.   You may need to print your Balance Sheet in Detail to see the GL account numbers that are in the Balance Sheet.   If you find an account that is on your Trial Balance but not on your Balance Sheet – this will need to be added the financial statement table.  If the assets are in balance go to #3.

3.  In the Trial Balance change the "1" to a "2" and print.  This is the total Liabilities and should agree with that line on the Balance Sheet.  If the two amounts do not agree follow the process detailed in #2 above.

4.  If the Assets and the Liabilities agree to the amounts on the trial balance, then run the Trial Balance with account types "4 & 5".  This will tell you what the Year-To-Date profit should be.   Verify that this number is what is printing in the Equity section of the Balance Sheet in "Current Year Income".  This should also be the Year-To-Date profit on the Consolidated Profit & Loss statement.

5.  If the Balance Sheet is showing a different amount than the trial balance for Current Year Profit then there a chart of account number that is set up incorrectly.  It could be that there is an income or expense account that does not have the right closing account number or is missing it altogether.  Go to General Ledger, Listings, Chart of Accounts.  You need to add to tab 1 "Selection List" the items called "Closing Accnt" and "GL Type Code".  Print the report  for all type 4 and 5 accounts there should be a closing account number listed and they all should be the same.  The closing account should not exist on account numbers for type 1, 2 or 3.  If you find an error go into Chart of Accounts Maintenance and fix the account number.

6.  You also want to verify that the "closing account" number is not carrying any kind of a balance.  You can look at this through GL Inquiry.  Enter the closing account number.  The only month that should have any kind of a balance in it is the last month of the year.  This balance should be reclassed to retained earnings during the first month of the New Year.

INCOME STATEMENT BALANCING:

  1. To verify that your Year-To-Date Profit and Loss statement is in balance run the Trial Balance report in Summary for the date range covered in the financial report but enter Account Types 4 and 5 in the top section.  Compare the closing balance on the Trial Balance to the Profit on the P&L.
  2. If these do not match you will next print the P&L “Unconsolidated” so that you can see what the bottom line is for each cost center.
  3. Run you Trial Balance report for account types 4 & 5 for each cost center individually.  Compare the closing balance to the bottom line of each Cost Center P&L.
  4. If they are out of balance calculate the difference and look for an account number in the Trial Balance that is for that amount.  For any account number that you find you will need to add the “Administrative Cost Center” account number ONLY to the financial statement table.
  5. Rerun the consolidated P&L to make sure it balances.

If you cannot locate the issue using the above procedures please log a support ticket by emailing [email protected] for assistance.