Can I start using Sage without a trial balance?

Can I start using Sage without a trial balance?

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I am attempting to set up a new Sage system for our business (bearing in mind I am not an accountant and am learning as I go!).  I am using Sages opening balance wizard to get everything set up.  I understand the steps (and reason) for entering supplier and customer opening balances and then reversing them to remove the suspense posting.  I also understand the neccessity of entering a trial balance to have an accurate balance sheet at the start of the year and in turn how this will then affect having accurate financial records throughout the year.

My two questions are;

1 - Can I start using Sage without a trial balance?  Our accountant has not yet given us the trial balance for last year but the boss would like me to start using Sage as soon as possible.  Can I start entering this years invoices and expenses into Sage and then put the trial balance in at a later date so as to retroactively correct the balance sheet?

2 - If I can start doing this how can I enter my opening bank balances?  The company has several different bank balances as well as a credit card and business loan.  When I attempt to set up our opening bank balances I get the double entry posting to the suspense account.  Would this be corrected when I enter the trial balance or do I need to do a journal entry to correct this?  If so what journal entry would I need to post?

Many thanks!

Replies (5)

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By Chris Smail
23rd Feb 2012 09:30

Yes

Set up opening Creditors Debtors and bank balances as per instructions and leave the resulting balance in Suspense for the moment.

If the accountant has made no adjustment to these figures (and if he has you will need to make them too which will revise the suspense balance) then when you get the TB and post it the Debtor Creditor & Bank postings should all go to this suspense account and clear it out.

If you have a complicated ledgers it may well be worth creating three separate suspense accounts:- Opening Debtors Suspense, Opening Creditors Suspense and Opening Bank Suspense so you can quickly identify the source of any differences.

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By petersaxton
23rd Feb 2012 10:17

Reason?

"I understand the steps (and reason) for entering supplier and customer opening balances and then reversing them to remove the suspense posting."

Can you explain the reason to me because I don't understand that at all. In fact it sounds totally wrong.

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By Chris Smail
23rd Feb 2012 10:39

Peter

Some 'advisers' (and I use the word advisedly) with little understanding of double entry tell clients to post the outstanding transactions to the ledgers, which builds the balance up in the control account and the contra on the suspense, then to clear the suspense balances by journal back to the control accounts and then to post the opening balances into the control accounts.

 

It is not the most stupid thing I have seen recommended but it comes close, why they cannot just post the control balance to the suspense I shall never understand.

 

I did sort out one mess where the software house 'helping' with the installation amended the default suspense account to the appropriate control account before posting the transactions! It seemed they did not think of using the programme to check the totals.

 

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By Fred Smith
23rd Feb 2012 11:30

I would start posting entries into Sage straight away and also load client static and create any new nominals that you may require.  The issue you will have by not having a starting balance sheet is that you will not be able to look at supplier and customer statements or see a true bank balance; you will only have movements from the start date of SAGE.  For example assume that your one customer owes you £1,000.  This is paid and entered into Sage.  The statement will show that the customer is £1000 in credit until such time as you enter opening balances.  BTW I am not a Sage expert but when I have used it I have found it fairly intuitive and my non accountant clients have coped.  Good luck. 

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Man of Kent
By Kent accountant
23rd Feb 2012 12:45

Agree with Fred

Just post the bank account opening balances with the balancing figure to suspense.

Any other attempts at creating an opening trial balance aren't worth the effort and you'll probably end up in a muddle, wait for your accountant to provide you with the correct information for this.

As Fred says you can reconcile your debtors and creditors and match receipts/payments against opening balances once the opening TB has been posted.

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