Overview
Issuing a Credit to the Opening Balance for Lease Charges
There are occasions when you will want to issue a credit to the opening balance for lease charges. This is mainly done when you record security deposits and lease payments that were made before your bank account's accounting start date and that have already been accounted for as part of your opening balance. This will prevent these transactions from being counted twice in your account's beginning balance.
The Steps
How to Issue a Credit to the Opening Balance for Lease Charges
To issue a credit to the opening balance on a lease, click on Leasing on the main menu and then click on Active Leases.
Find the lease for which you want to issue a credit and click on it.
Click on the Transactions tab and then the Issue Credit button.
On the Issue Credit window, enter the following information to issue a credit:
Category: choose the account category for the credit. In this instance, when issuing a credit to the opening balance, you want to use the following: choose Equity > Opening Balance.
Description: enter an optional explanation for the credit. (What you enter here is what the tenant will see on their lease ledger in the tenant portal. If you leave it blank, the tenant will just see the word “Credit.”)
Amount: enter the amount for the credit to the opening balance.
Date Issued: change the date for the credit if needed.
Add Line Item: use this link to add additional credit items if needed. (You could also create separate credits for each line item.)
Add memo: add an optional note for your reference when reviewing the credit later.
Once you have completed these steps, the credit will be reflected in your bank account's opening balance. This will ensure that your account's beginning balance is accurate and does not include any duplicate transactions.
When to Issue a Credit to the Opening Balance for Lease Charges
As mentioned earlier, you will want to issue a credit to the opening balance for lease charges when you have already recorded lease payments and security deposits that were made before your bank account's accounting start date as part of the opening balance. This will prevent these transactions from being counted twice in your account's beginning balance.
Note: Only issue a credit to the opening balance if it has been accounted for as part of the opening balance you entered for your bank account and if those payments were made before the accounting start date.
Issuing a credit to the opening balance for lease charges is a simple process that can help ensure the accuracy of your bank account's beginning balance. By following the steps outlined in this article, you can easily avoid double-counting transactions and maintain accurate financial records.