Whether you are importing data from another software to SILQ, or you are starting with a blank SILQ datafile, but have accounting data elsewhere, you will need to enter the opening balances to have your accounts match your previous system.
Even if data is imported from another software to SILQ, from an accounting perspective, it is not feasible for all of the intricate accounting data to be imported into SILQ for a variety of reasons, with a big reason being that every system operates & captures data slightly different and therefore all of the data may not actually be available for import.
You can start using SILQ without entering opening balances, but your bank balances and reporting won't be accurate until you enter them.
Therefore, these are the key steps you will need to follow to get your data to match your previous system.
Please note: we suggest a qualified accountant or bookkeeper handles this process for you.
You should be aware that by following the below process your reports will be accurate as of the transition date, however you should be relying on reports your old software
Step 1 - Transition Date
The first and essential step is to draw a line in the sand to say on the 31st of December (for example) we will stop using the old system and from the 1st of January we will start entering all transactions into SILQ.
The 1st of January therefore is your transition date.
The only transactions you should enter in SILQ dated before this date are outstanding invoices and outstanding (unpaid) expenses as at the 31st of December (i.e. the day before you start using SILQ).
It's important the transition date is the day after the date when you balanced all your accounts in your previous system. Whatever report you decide to use to enter balances from, make sure you’ve run this report to the day before you want to start using SILQ - i.e. your transition date (in the above example that would be the 31st of December).
Step 2 - Enter Aged Creditors & Aged Debtors
As mentioned above, only outstanding invoices and unpaid expenses should be entered into SILQ as at the day before the transition date (i.e. the 31st of December using the above example).
If you are importing data from another software and the data is available, SILQ will import the outstanding invoices for you.
It is important to compare your Aged Debtors report as at the day before the transition date (i.e. 31st of December) from the old software to what it shows in SILQ using the same as at date. The two numbers should match. If they do not, you will need to work with SILQ to identify what is missing and correct (sometimes not all information is available for import and there could be circumstances where some entries will need to be entered manually).
Once the two Aged Debtors reports match, move onto the Aged Creditors reports and follow the same process as Aged Debtors. SILQ does not normally import Aged Creditors as part of the data import, therefore these likely need to be entered in manually.
Step 3 - Match Chart of Accounts
The chart of accounts is a structured list of all the accounts a business uses to record its financial transactions, organised by categories like assets, liabilities, equity, income, and expenses.
Navigate to the chart of accounts in SILQ (Accounts > Chart of Accounts) and check that SILQ has an equivalent account for all the accounts on the balance sheet generated from your previous software, as at the day before your transition date (i.e. the 31st of December in the above example).
If the accounts do not match, you can either edit existing accounts or add new accounts (or possibly a combination of both.
Find more information on navigating the Chart of Accounts window here.
When done, please make sure to review your chart of accounts one more time to make sure that they match exactly to your old system.
Note: now that you have made changes to the chart of accounts, it is worth checking you default accounts to ensure transactions are going to the right spot. You can adjust these settings in Default Accounts found in System Settings. Transactions will still go to an account that has been made inactive.
Step 4 - Find your closing balances
We need to find the closing balances for ALL accounts (Balance Sheet & P&L) in your previous Practice Management Software, Excel spreadsheet or other record keeping system, as at the last day you used that system - i.e. the day before your transition date. In the above example that would be the 31st of December.
These balances are the opening balances for your accounts on the day you start using SILQ - i.e. your transition date. These balances will form the starting point for all your reports in SILQ.
To get these balances, you will need to generate a copy of Balance Sheet & P&L from your previous Practice Management Software, Excel spreadsheet or other record keeping system, as at the day before transition date.
Step 5 - Work out adjusted opening balances needed
Entering opening balances involves using the closing balance from the previous financial period and comparing that to any existing balances in SILQ. The difference between the two needs to be calculated and that will give you the adjusting journal required to accurately represent the company’s financial position at the beginning of the transition to SILQ.
Let's assume that these are your closing balances from the old system, to be used as opening balances in SILQ.
You need to enter all balances as positive numbers, even if they’re negative numbers on the balance sheet / P & L. Enter debits as positive numbers in the Debit column and credits as positive numbers in the Credit column. The total debits and total credits should match.
|
Account
|
Debit
|
Credit
|
|---|---|---|
| NAB Account |
10,000
|
—
|
| Accounts Receivable |
20,000
|
—
|
|
Equipment
|
50,000
|
—
|
|
Accounts Payable
|
—
|
15,000
|
|
Owner's Equity
|
—
|
75,000
|
|
Total
|
80,000
|
80,000
|
Then your comparison of your old system vs what is in SILQ will look like the below. To work out the adjusted opening balance in SILQ, you need to work out the difference between the numbers in the two systems.
| Balances in old system | Balances in SILQ | Calculation | Journal to add to SILQ | |||||||||
| Account | Debit | Credit | Account | Debit | Credit | Account | Debit Adjustment | Credit Adjustment | Account | Final Debit | Final Credit | |
| NAB Account | 10,000 | NAB Account | 32,000 | NAB Account | 22,000 | 0 | NAB Account | 22000 | ||||
| Accounts Receivable | 20,000 | Accounts Receivable | 10,000 | Accounts Receivable | -10,000 | 0 | Accounts Receivable | 10000 | ||||
| Rent | 50,000 | Rent | 5,000 | Rent | -50,000 | 5,000 | Rent | 55000 | ||||
| Accounts Payable | 15,000 | Accounts Payable | 32,000 | Accounts Payable | 0 | 17,000 | Accounts Payable | 17000 | ||||
| Owner's Equity | 65,000 | Owner's Equity | 5,000 | Owner's Equity | 0 | -60,000 | Owner's Equity | 60000 | ||||
| Total | 80,000 | 80,000 | Total | 42,000 | 42,000 | -38,000 | -38,000 | 82000 | 82000 | |||
The below diagram shows how debits and credits are applied to specific account types.
Step 6 - Enter opening balances
Now that you know your opening balances, use the General Journal to enter those in SILQ.
The general journal is the primary place where financial transactions are initially recorded in detail, using debits and credits before they’re posted to the relevant accounts in the ledger.
To get to the General Journal click on Accounts > General Journal.
Then:
1. Click on New
2. Enter the transition date you identified in step 1 (i.e. using the above example, it would be 1st of January).
3. Type in the name for the description of this transaction. We suggest using something like ‘Balance carried over from previous system’ to be clear for future reporting.
4. Click on New Item, type in the amount you had calculated in step 5 for your first account.
5. Choose either Debit (DR) or a Credit (CR)
6. Click on the icon in the account field and choose the account it’s for.
7. Click on Add Item to add it to the journal entry.
8. Repeat this step for every account identified on your trial balance report/ balance sheet from your old system.
If all data is entered correctly the Debit Total and Credit Total will match. You can then click on Save to record this journal entry into SILQ.
If the Debits and Credits don’t match, double check all debits and credits have been entered correctly. If you find a mistake you can click on a line item and then Delete Item to remove it, then click on New Item to re-add it correctly.
Now that you have entered all your opening balances, if you found you needed an adjustment general journal entry for one of your bank accounts, you will need to do an initial reconciliation as at the day before your transition date to bring the bank balance to what is shown on your bank statement.