• Ant
  • New member
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  • From: Johannesburg,South Africa
  • Registered: 04/13/2009
  • Posts: 9

Topic: Take-on of customer balances

I've read through a variety of old posts about the best way to take on customer balances, but nothing jumped out at me as definitive or very clear.

One post by admin in 2007 ended by saying "We will later create a more detailed article on this item." Has this been done? Perhaps I missed it.

I understand the idea of posting take-on balances at the end of the last fiscal year, but am still confused about how to do this. Let me illustrate my question more clearly (in the hope of getting a clearer answer):

I'm just starting out running my accounts on FA. Let's say I have just one customer (CompanyX) who owes me $1000 at the end of December 2008. Before I open the 2009 fiscal year (assuming my fiscal year runs from January to December) I need to record this debt. So what do I do? If I post a journal with a debit of $1000 to accounts receivable, where is this linked to the customer CompanyX? No problem with the principle of counterbalancing the journal with a corresponding credit entry of $1000 to a new account called 'Take-on balances' or whatever. But I'm clearly missing the link that will tie this to CompanyX.

Any suggestions?

  • joe
  • Administrator
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  • Registered: 03/15/2007
  • Posts: 5,107

Re: Take-on of customer balances

There is always a problem converting from one Accounting system to another and especially customers/suppliers/items and inventory.
If you only have a couple of invoices, you can just reenter them in FA on the year before. While you have already sent these invoices to your customers you just leave them as is. When the customer pays in the new year, you just allocate these invoices and everything is ok. You should probably use the correct references for the invoices, to easyly find them.

I hope this helps you. You could also ask your auditor or an accountant what is the most common way of doing it in your country.

/Joe

  • Ant
  • New member
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  • From: Johannesburg,South Africa
  • Registered: 04/13/2009
  • Posts: 9

Re: Take-on of customer balances

Thanks for your prompt response & helpful suggestions. That's probably the best way to go - I have already started down this track.

My questions referred to the writeup in the user manual (and comments in the forums) to post journals for take-on balances, but these clearly wouldn't tie up to the debtors journal or whatever underlies and ties into customer balances.

Ant