How to Add Opening Balances in Xero

How to Add Opening Balances in Xero

Adding opening balances in Xero primarily involves using the 'Conversion Balances' feature. First, navigate to Accounting -- Advanced -- Conversion Balances and set your 'Conversion Date' – this is the day you start using Xero. Next, input the closing balances from your previous accounting system for all your balance sheet accounts (Assets, Liabilities, Equity) as of that conversion date. For bank accounts, you'll enter the reconciled balance here, but also ensure you reconcile any transactions up to the conversion date separately. Accounts Receivable and Payable balances aren't entered here; instead, you'll create individual outstanding sales invoices and purchase bills as of your conversion date. Any difference in your conversion balances will automatically be posted to a 'Historical Adjustments' or 'Retained Earnings' account to ensure your books balance. After entering all figures, review for accuracy before saving.

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