Retained earnings showing wrong balance in GL transactions

Retained earnings account is not showing transactions that took place in the reporting period (only shows opening balance) and thus shows a wrong balance in GL transactions in version 21.5.10

See pictures below

In the GL transactions


In the Trial Balance

Yeah its not including profit for the period in the GLT report.

I’d say this is not a bug - it’s basically as designed. The issue is that I haven’t figured out how best to present Retained earnings general ledger.

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My understanding is currently the retained earnings

  • Shows the correct total retained earnings of a business

  • The drill down shows all transaction explicitly referencing the retained earrings account

  • Retained earnings of a business (as is display correctly in Manager) implicitly also depends on every profit and loss transaction. These are not shown in the drill down as they are better displayed in the profit an loss.

Overall I like this behaviour as it means all drill downs show all transactions which explicitly involve that account.

The alternative is for the retained earnings drill down to also show all transactions which implicitly effect the account (every profit & loss transaction) but in doing so it would mask the explicit transactions.

I my opinion that would only be valuable if future project / sub-division costing enhancement resulted in some profit and loss transactions effected sub-division retained earnings not the businesses retained earnings.

I am not sure which “drill down” you are referring to, but when I drill down on Retained earnings they (the P&L transactions for all time) are listed as an aggregate total at the top of the list. This makes the running balance in the list meaningless.

Correct transaction implicitly effecting retained earns are displayed as a single total figure. This is consistent with the total displayed prior to drill down including transactions which explicitly and also implicitly reference retained earnings.

Imo this is the optimal way of displaying these implicit entries in retained earning. The best place to see details of transactions which implicitly effect retained earnings is in the profit and loss section of Manager.

No, drill down of retained earnings is very useful with this behaviour as it clearly shows all transactions which explicitly reference retained earnings. Such as

  • Distribution of profit from retained earnings

  • Transaction using an account not included in this business (such as a private bank account for a sole trader).

The behaviour is consistent with drill down elsewhere in Manager. It shows transactions explicitly referencing the account you drill down on.

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This is correct and it bothers me too that running total on Retained Earnings is broken.

However, aggregate total at the top is still better than listing every single P&L transaction ever individually. When you drill-down into Retained Earnings, chances are you are looking for transaction posted explicitely to Retained Earnings account as @Patch points out.

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I can see that there is no easy solution without showing all the P&L transactions individually.

The best that I can come up with is to show all the P&L transactions on drill down, but have a check box at the top of the list to reduce the P&L transactions to an aggregate total.

This, however, will not provide a solution to the issue in the GL transactions report which was raised by the OP.

It has 2 problems, the opening balance is incorrect and there is nothing shown for the P&L transactions for the period of the report.

Looks like a report problem not a summary page drill down problem to me.
Implicit changes to retained earnings are a calculated amount not a direct GL entry.

Correct, I was feeling a bit guilty because I hijacked the original issue raised, by mentioning the drill down problem.

I would suggest to show in the GL Summary Transaction the Retained Earning Year Wise instead of 1 lum sum amount. this way it will show the correct movement transaction and will also give a good explanation from where this figure come up

@abdulbari this wouldn’t work in countries where financial year is different from calendar year. Monthly breakdown would be more appropriate but then you have countries like UK where financial year ends on April 5th so even monthly breakdown would be inappropriate. The lowest common denominator is to show profit/loss for each day which might be the best way out of this.

Implicit changes in retained earnings is a calculated value based on most of the general ledger entries. Manager doesn’t show drill down on calculated values elsewhere, and I don’t think showing most of the general ledger in a drill down helps business understanding.

However showing changes before separate to during a reporting period probably is useful. That would mean Manager’s report writer calculate and displayed both separately (without drill down)

  • For the summary page that would use the defined reporting period

  • for general ledger reports that would use the reporting period defined in the report.

That’s exactly why the user should input the periods.

Yeah, but isn’t it overkill just for the drill-down into single account?

Just use the periods already defined in Manager

Not every report has defined period. For example, balance sheet is as at.

will this help if filing date ( year end which should be only DD-MM ) which mean the system will consider this date in retained earning and other reports for year end closer and profit calculation at this date every year. same as start date to inform the system opening balance this will allow all users to set up the closer date for their year end so the system will do the needful same as start date

The GL transaction report and similar show transactions for a period. For all such report a:

  • retained earning opening balance and
  • retained earning implicit period contributions

Would be possible and probable help a reasonable number of people (not sure about the actual words though).

That will cover everyone’s tax reporting periods as they already manually define the relevant reporting periods. Similarly for the summary page, a reporting period is also defined.

I agree for Balance sheet reports, they use “as at” so only a single number can be reported “Retained earnings implicit contributions as at …”

I have reexamined the reports and gave it more thought, and it seems not only do the TB Retained Earnings ignore opening balance at report from date but so does every other account. That goes against everything I did prior to using manager.

However, having been audited many times while using manager, I really haven’t noticed this at all because I have been using GL Summary report instead the whole time and didn’t need to draw a single TB report.

So …

Maybe, but the question now is this: Yes, the TB report breakdowns are weird, but do we really have to change it given that we already have the GL Summary report?