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Retained Earnings system-generated entry

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  • Retained Earnings system-generated entry

    Started using PT Premium 2008 in late 2007 for a brand new company. Changed periods from 12-07 to 01-08, which created the automatic entries to zero out P&L accounts and create an entry/beginning balance for Retained Earnings.

    Problem is that the RE beginning balance for 2008 does not equal the net loss for 2007, so something else must have been included in the automated closing entry to Retained Earnings.

    Is there any way to "see into" those automated entries? Or has anyone else experienced a similar issue and discovered a way to diagnose and correct the issue? Any suggestions for correcting it?

  • #2
    You can start your investigation by printing a General Ledger for the Retained Earning Account for all open periods (24).
    Rick Prindiville
    PCO Consulting Services, Inc.
    rick@pcosupport.com
    Peachtree Certified Consultant
    Sage Certified Trainer

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    • #3
      Already did that. The only activity is a lump sum reflected as beginning balance on 1/1/2008. No activity before that or after than in Retained Earnings. Balance went from $0 at 12/31/07 to a Beg. Bal. for 1/1/08 that is not the same amount as the net loss for 2007. Any ideas on how to see the details of what was included in the system-generated year end closing entries? Thanks for your help.

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      • #4
        Retained Earnings represents "Historic Earnings" or the sum of all prior year net earnings (profit or loss). From your description then the Retained Earnings is reading correctly, as this account is updated once year upon year end closing.
        Rick Prindiville
        PCO Consulting Services, Inc.
        rick@pcosupport.com
        Peachtree Certified Consultant
        Sage Certified Trainer

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        • #5
          And you can change it by going to the "BEGINNING BALANCES" located in the accounts screen.

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          • #6
            You can see all the transactions for all accounts in a General Ledger account. If you don't have a huge amount of transactions you should be able to solve the mystery.
            J.R.
            Peachtree 2002 (I know it's old...but it's fast )
            Windows XP Pro

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            • #7
              I think the problem here is that Peachtree is making some kind of transaction that only changes the beginning balance for that account so it can't be seen as a regular JE.

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              • #8
                I had similar problem , tried " Data Verification" and it straightened everything !
                dan

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                • #9
                  I'm in the middle of something and don't have time to discover the details but here's how to change it: When you enter beginning balances, if you change numbers and they don't add up to zero = in balance, PT makes entries changing your beg. balance equity when you say OK. You can't see these JEs but you can change them.

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                  • #10
                    Unless you explicitly make a transaction to the Retained Earnings account there are no actual closing entries made to this account. Instead Peachtree determines the amount of the Retained Earnings by setting it to whatever is needed to make the activity of all accounts add up to 0.

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                    • #11
                      Originally posted by Robert Walraven View Post
                      Unless you explicitly make a transaction to the Retained Earnings account there are no actual closing entries made to this account. Instead Peachtree determines the amount of the Retained Earnings by setting it to whatever is needed to make the activity of all accounts add up to 0.
                      But... You can choose to make it add up to something besides zero in the beginning balances. If you do this, the difference is put to the "Beginning Balance Equity" account and then you can make a journal entry to move it wherever you want.

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                      • #12
                        Yes. That is essentially what I said.

                        If Data Verification doesn't cure cskocik's problem, and examining the Journal Ledger for the Retained Earnings account for all open periods doesn't give a clue, and if the beginning balance form looks normal for the appropriate date, then the only way I know of determining where the problem is would be to examine the data with PawCom.

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                        • #13
                          Is your Retained Earnings amount equal to the previous year's revenues and expenses. This is where the amount comes from when you close a year.

                          This is what Peachtree says about incorrect Retained Earnings balances:
                          If the balance in the Retained Earnings account is incorrect, verify the following:

                          1. Select Reports from the Peachtree menu, then select General Ledger and click on the General Ledger once so that it is highlighted. Select the Preview button. In the filter area, change the time frame to All so that it displays the entire General Ledger report for all periods. If you receive the error “General Ledger Does Not Foot in Period ##” then see Answer ID 353 Click Here in the Peachtree Knowledge Center.

                          2. If the General Ledger does not have footing errors, then select Reports from the Peachtree menu, then select General Ledger and then select General Ledger Trial Balance. Make sure this report is in balance by going to the bottom of the report and checking to make sure that debits equal credits. If they do not equal, then run an Integrity Check:
                          Heather Phillips
                          Certified Peachtree Consultant
                          Advanced Crystal Reports Certification
                          Accounting Solutions For Less
                          1159 North Firetower Road
                          Blythewood, SC 29016
                          www.AccountingSolutionsForLess.com
                          HSmead@aol.com
                          Phone: 803-834-6924

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