Balance equity issue

1

Closing a year (2019) and start a new year (2020) the Profit&Loss from 2019 (= 47.111).
Manager’s automatically posting (transferring) the P&L to the Retained Earning account (= "cumulatief resultaat) on balance sheet 31-12-2018. So far all OK.

But starting a new year 01-01-2020 this P&L amount (47.711 from 2019) should transfered to the Starting Balance equity (new start 2020). So on 01-01-2020 this amout shoul be 97.710 + 47.711 = 145.421
The Retained Earing (Cumulatief Resultaat) on 01-01-2020 should be zero… in my situation this will not transfered automaticly. The Starting Balance remain at 97.710 and the Retain Earning will grow from 47.711 to (for example) 67.711 adding 20.000 P&L from 2020.

I try to transfer manual with a journal entry, but i can not open “Starting Balance Equity”, it’s not listed.
My idea is to create a new account (for example) “test kapitaal rekening”, but in this case the Starting Balance Equity always remain at 97.710… that’s not an award winning solution.

Do i overlook something, or how can i fix this?

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2

@avcsupport
The solution is quit simple:
Create a journal entry
Debet: Retained Earnings (Cumulatief Resultaat)
Credit: Equity account (Kapitaalrekening)
Manager doesn’t know what to do with the retained earnings so the balance stays is automatically allocated to this system-G/L account
By transferring the retained earnings to the Equity account, you allocate the retained earnings.
If you can’t get it fixed send me a private message.

3

Hello Hennie,
Yes, this seems quit simple…
But when i want to create a Journal Entry, i can not open “Balance Equity”… it’s not listed…
So i leave this open, so the Retained Earnings amount 47.711 is add to suspense…
This is not the proper way, because this way the Balance Equity always remain 97.346
Why is the account “Balance Equity” not listed???

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4

I think it is best that you send me a private message because your problem is not a Manager problem but much more an accounting problem.

5

Two points, @avcsupport:

  • The Starting balance equity account is an automatic account Manager creates to balance the accounting equation (Assets = Liabilities + Equity). It should always be zero. If it is not, that means you have set something up incorrectly. You cannot fix this by direct posts to Starting balance equity, but must fix the imbalance wherever it occurs.
  • You mentioned closing 2019 and starting a new year. Manager is a perpetual system. So you do not close the records of one year and begin anew as with old-fashioned, traditional accounting systems. See this Guide: Close an accounting period | Manager.
6

Starting balance equity account can be eliminated by adjusting “Starting Balances” in settings.

First go to settings>chart of accounts and create appropriate equity accounts.

Then go to settings>starting balances and enter the portion of equity for each account by selecting edit next the equity account and enter the equity starting balances so that the grand totals are equal.

Like this (2 equity accounts)

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Then in future years Retained earnings can be journalled to these equity accounts

7

Aha… now i understand. I did not know that the Starting Balance Equity for the next year should be zero.
So i need to transfer this amount to other accounts. This i did not know.
Now i can continue.

Thank you !

8

Hello @Hennie, i received a solution from @Tut and @AJD
I never knew that the Starting Balance Equity should be balanced to zero.
I thought that the SBE means the company Equity, every year add up with RE. It’s not.
I need to create a company (and private) Equity.

Thank you all for feed back.