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Reversing and correcting journal entries

How to reverse or correct existing journal entries

In order to enforce an audit trail it is not possible to delete an entry once it is posted. This is true for all source journals (whether the entry comes from accounts payable, accounts receivable, straight from the general ledger or another journal). If you wish to correct a mistake in an entry you must reverse and correct it.

Reversing entries

You can reverse several existing entries by selecting them on the GL Journal Entries screen and then tapping the Reverse checked entries button. In this case all selected entries will be reversed automatically and a notification will be presented while the reversing entries are being created and posted. Reversing entries will be exact copies of the originals except that their descriptions will be modified to show information about the original entry they are reversing. Once they are posted the notification will disappear and the page will reload.

You may also reverse any entry by drilling down to the entry from the GL Journal Entries screen or from a report such as the G/L Account Detail Listing. To reverse the entry tap the Reverse button at the bottom of the entry. The system will create a reversing entry and display it for you to review and approve. At this point you can Cancel, in which case the reversing entry will be discarded and the original entry will remain as it was, or you can Post it.

Both original and their reversing entries will appear on the GL Journal Entries screen and G/L Account Detail Listings. Information about the original entry will be added to the description field in reversing entries for tracing purposes.

Correcting entries

You can only correct a single entry at a time because you need to indicate what specific corrections need to be made. You may correct an entry from the GL Journal Entries screen by selecting an entry and tapping the Correct selected entry button, or by drilling down into the entry and tapping the Correct button at the bottom.

When you tap the Correct button the system reverses the original entry automatically and posts the reversal entry without further confirmation. It then creates a new entry with all of the information from the original entry and leaves it in an editable mode for you to make whatever corrections you need to make. Once you are done making the corrections it expects you to post the correcting entry. If you tap the Cancel button the correcting entry will be cancelled, but please note the reversing entry will have already been posted.

If you have accidentally reversed an entry by tapping the Correct button you have three options to reinstate the original:

  1. If the correcting entry is still on the screen in edit mode you can simply post it without making any changes. That will re-post a new entry equal to the original with no net changes in the group of reversing/correcting entries;
  2. If the correcting entry has been cancelled you can find the original entry and duplicate it (select it in the GL Journal Entries screen and tap the Duplicate button). Make sure you post the new entry; or
  3. You may also find the erroneous reversing entry and reverse it. This will create a new entry and once posted the group of entries will have no net changes.

Tracing reversing and correcting entries

Entries that are part of a group of reversing or correcting entries give you the option to view all related entries when you drill down into one entry. A message will indicate that the entry is part of a group of correcting/reversing entries and a link is provided that shows all entries in a side-by-side view with totals so the user can see the net effect of all entries.

Fiscal period concerns

If the fiscal period of the original entry has been closed you will need to specify a new fiscal period for the new entries. If a reversing entry is being posted automatically (for example if you have pressed the Correct button) then the system will prompt you for a new fiscal period and the entry will be posted to that period with the original date. If you have pressed the Reverse button you will have a chance to set the date and/or new fiscal period manually before posting it.

Inter-company entries

If you are reversing or correcting an entry that was posted directly to an inter-company account the system will also reverse and correct the related entries in the other company.