Beginning Account Balance

After completing the detailed beginning balances for receivables, payables, inventory, and fixed assets, the next step is to complete the beginning balance outside of those positions in the beginning balance menu.

The beginning account balance in accounting is the amount of money or value recorded in an account at the start of a certain accounting period. This beginning account balance is the result from transactions and business activities that occurred in the previous period and are recorded in the company's accounting system.

For example, at the beginning of the fiscal year, a company has a cash balance of IDR 50,000,000. Therefore, the initial cash balance in that fiscal year is IDR 50,000,000. When the next accounting period begins, the beginning balance will serve as the basis for calculations for transactions occurring in that period.

In practice, the beginning account balance can be determined by recording all transactions that occurred in the previous period and calculating the total ending balance of each account at the end of that period. This ending balance will become the beginning balance in the next period.

Setup

To complete the beginning account balance, select the menu Miscellaneous / Setup Menu / CoA Beginning Balance. See figure 8.4

Figure 8.4 - Wizard Coa - Beginning Account Balance

1. In the CoA Code combo box, select the necessary account that you have previously completed in the Chart of Account menu.

2. In the Modification column, type the beginning account balance value.

3. The right side of the form will automatically display the base currency amount of the account value you have registered.

4. Click the Save button when finished.

5. Next, the system will display a list of all accounts in the column at the bottom of the menu.