To import opening balances into QuickBooks Desktop, pick a start date, take each account's balance at the end of the day before it, and record those figures in one journal entry against Opening Balance Equity. Open invoices and bills go in one by one. Bank imports then begin on the start date, so the register agrees with each statement.
Picking the start date that Desktop opening balances belong to
The start date is the first day your Desktop books cover in full. Opening balances are the figures at the close of the day before. Choose the first day of a month, quarter or year, so the opening figures line up with a statement ending date and the first bank import covers a whole period.
A year start is the cleanest, because the prior year's figures stay in the old records and every report in Desktop covers complete years. A mid-year start works too, but then your tax return draws on two sets of books for that year. Pick the date with whoever prepares the return.
Line up the statements
Before you settle the date, check when each account's statements end. Most checking statements end on the last day of the month, but some end mid-month, and card statements often close on a set day like the 18th. If a card closes on the 18th, its balance on December 31 is not printed anywhere. You will need the statement ending January 18 to work it out, which takes more care than a month-end account.
Do not start before your history is ready
A start date two years back means importing two years of bank lines. A start date this month means a much shorter catch-up. Pick the earliest date you actually need in Desktop, not the earliest date you have statements for.
Which statement figure is a bank account's opening balance?
For a bank account, the opening balance entry uses the ending balance printed on the statement for the day before the start date. Checks and deposits you had written or made but the bank had not yet cleared are then entered one by one, on their real dates. Together they leave the register at your true book balance.
Splitting it this way lets each uncleared item match its bank line later. The bank's figure is the one you can prove from paper. The outstanding checks are what separate it from the cash you actually have to spend, and entering them individually means each one clears on its own when the next bank file arrives.
Credit cards
For a card account, the opening balance is the amount owed on the statement that closes on the day before the start date. When the card closes on another day, use the closing balance of the last statement before the start date and enter the charges between that closing date and the start date one by one. They then match the next card file like any other line.
Loans and other balance accounts
For a loan, use the lender's principal balance on that date, not the payoff figure that includes daily interest. For fixed assets, use the cost and accumulated depreciation from the last depreciation schedule. Your accountant may already have these in a trial balance.
Entering bank and card opening balances against Opening Balance Equity
Each opening balance needs a second side, and in Desktop that side is the Opening Balance Equity account. A bank balance is a debit to the bank and a credit to Opening Balance Equity. A card balance owed is a credit to the card and a debit to Opening Balance Equity. Date every line the day before the start date.
Desktop creates Opening Balance Equity for this purpose. It is a holding account. Once every balance is in, the amount left in it should equal the owner's equity or retained earnings at the start date, and your accountant moves it there with one entry.
Worked example: a sample company starting January 1
The figures below are an example for a company starting its Desktop books on January 1. The statement figures come from each account's December statement.
| Account | Statement balance Dec 31 | Outstanding items | Opening balance | Debit | Credit |
|---|---|---|---|---|---|
| Operating checking | 18,240.55 | Checks 2088 and 2091 out, 1,310.00, entered separately | 18,240.55 | 18,240.55 | |
| Savings | 25,000.00 | None | 25,000.00 | 25,000.00 | |
| Business card | 2,118.42 owed | None | 2,118.42 owed | 2,118.42 | |
| Equipment loan | 14,600.00 principal | None | 14,600.00 owed | 14,600.00 | |
| Opening Balance Equity | 26,522.13 | ||||
| Totals | 43,240.55 | 43,240.55 |
The two outstanding checks go into the checking register as separate checks dated in December, with their payees. Their expense already sits in the old books, so code them to Opening Balance Equity rather than an expense account. After they are in, the checking register shows 16,930.55 on December 31, which is the cash the business really had. When January's bank file brings checks 2088 and 2091, they match the open checks and clear.
Why one entry is easier
Typing a balance into each account's own setup screen works, but scatters the figures across the file. A single dated entry shows every opening figure on one page and is easy to compare with a trial balance later.
Can all opening balances go into Desktop as one imported entry?
Yes. A set of opening balances is a single general journal entry, and Desktop can import journal entries. Intuit's guide to importing and exporting data in QuickBooks Desktop lists account beginning balances and general journal entries among the transaction types that can be imported. The same page warns that you cannot undo an import.
For a handful of accounts, typing the entry is quicker than building a file. For thirty accounts from an accountant's spreadsheet, importing saves errors. Importing a trial balance into QuickBooks Desktop walks through turning a debit and credit sheet into an importable entry.
Every account must exist first
The import cannot create bank, card or loan accounts with the right type. Set up the chart of accounts first, with names that match the spreadsheet exactly. A name that differs by one character either fails or creates a new account you did not intend.
Back up before the import
Since an import cannot be undone, make a backup just before it. If the opening entry comes in wrong, restoring is far quicker than reversing each line.
Receivable and payable opening balances in Desktop
Do not enter accounts receivable or payable as one lump sum. Desktop tracks them by customer and by vendor through open invoices and bills. Enter each unpaid invoice and bill dated on its real date before the start date, so payments received after the start date can be applied to them.
A lump sum in accounts receivable has no customer attached. When the customer pays in January, there is no invoice to receive the payment against, and the payment ends up as income again. That double counts the sale.
Customer and vendor lists first
Open invoices need customers, and open bills need vendors. Load those lists before the invoices. Customer lists often already exist in another program; importing customers into QuickBooks Online covers the Online side of that job, and the column layout is a useful model for a Desktop list.
Their total feeds the equity figure
The open invoices total debits receivable, and the open bills total credits payable. Record each against Opening Balance Equity, or against an income or expense account if the sale or purchase belongs to the new period. Ask your accountant which, because the answer depends on whether you report on cash or accrual.
Outstanding checks that throw off a Desktop opening balance
The most common opening balance mistake comes from outstanding checks. If you put the lower book balance in the opening entry and also enter the uncleared checks, the register is too low by their total. If you use the statement balance and skip the checks, the first bank import adds them as new expenses.
In the worked example above, checks 2088 and 2091 totalled 1,310.00. The setup uses the statement figure of 18,240.55 in the opening entry and enters the two checks on their own. The register then shows 16,930.55, and when January's bank file brings the checks, they match and nothing new is added.
Spotting the mistake later
If the first reconciliation is off by an amount equal to some December checks, this is almost always the cause. Find the checks, compare the dates and fix whichever side was doubled. Do not adjust the opening figure blindly; a guess that closes the gap can hide a second error.
Copying from another company file
If the business already had books in a different Desktop file, you might be tempted to copy every past transaction across instead of starting fresh. Copying transactions between QuickBooks Desktop company files explains when that is worth doing and when opening balances are the better route.
Proving Desktop opening balances before the first bank import
Before you import any bank file, run a balance sheet as of the day before the start date and compare every line with your source figures. Then reconcile each bank account for that date: the register balance plus uncleared checks should equal the statement's ending balance. Only then import the first file.
A three-line check per bank account
For each bank account, write down three figures: the statement ending balance, the total of outstanding items and the Desktop register balance on the day before the start date. The register figure plus outstanding checks, minus deposits in transit, must equal the statement figure. In the example, 16,930.55 plus 1,310.00 equals 18,240.55.
Then start importing
With the balances proven, bring in the first period's bank lines. Importing bank transactions into QuickBooks Desktop covers the Web Connect steps. If your statements are only PDFs, SimpleBankConvert is being built to turn them into import files, and you can sign up on the get started page for early access.