Last week, I did a QuickBooks implementation for one of my client. I discovered that they had an amount in the Opening Bal Equity account. According to the user, this amount was there since she took over the account two months ago.
We traced back the amount and discovered that this amount was in the book since 2006 as an Opening Balance for a Bank account. The Balance Sheet report consisted of only Bank and Opening Bal Equity account. The double entry was debit Bank account and credit Opening Bal Equity account. So now, the questions are:
- Why was there an amount in the opening balance of the bank account?
- Why there were no other opening balances of the balance sheet accounts such as Assets, Liabilities and Equity accounts?