This article explains how your balances can become out of balance and what steps you need to take if this happens.
Accounting Health Checks
Health checks are an automated feature where Actionstep will look for anything in your system that would not be considered "normal" accounting practice. Each night Actionstep will run these checks on your system and if it brings up anything it will alert you.
If there are any health checks that Actionstep has detected it will display on the screen each time that a user with Administrative access to Accounting logs on. Other users without this permission will not see the warnings.
For each possible issue that Actionstep finds it displays on the Health Check page. If you are not sure how to resolve the issue then we recommend that you raise the issue with your accountant. They should be able to help you find and resolve the cause of the issue.
If you have fixed the issue you can test that it is resolved by clicking the Check again now button. You can move off the screen by clicking the Continue to your home page button.
|Actionstep will not automatically re-check that the issue is resolved. Even if you resolve the issue, Actionstep will continue to show on the Health Check screen each time you log in until you click the Check again now button.
There are three "common" problems that create an out-of-balance error. The first is the opening balances date has been changed, the second is that the opening balances are either incorrect or have not all been entered and the third is out of balances being caused by the incorrect set-up of multi-currency or FX settings.
Date of opening balances
Make sure your opening balances date is correct - you can check this by going to Admin > Accounting > Accounting system preferences > scroll to Financial dates - make sure the date of the opening balance is correct.
The opening balances and opening balance date that you have set up will have an impact on your balances. To check your opening balances -
To access your accounts list, navigate to Accounting > Accounts > Accounts List.
If your accounts are out of balance you will see an error on this screen like the below.
To review/edit the opening balances, click on the 'Edit Accounts' button highlighted in the screenshot above.
This screen will display all your opening balances if you are unsure about how to correct your opening balances please talk with your accountant.
Multi-currency causing an out-of-balance error
A number of accounts need to be set up when enabling FX or multi-currency accounts however some accounts should not be set up. See instructions here: multi-currency article
The purpose of mapping some accounts in multiple currencies is to allow users to receive funds in multiple currencies and convert the value of that currency into the system's "Base Currency" by the time those balances hit the financial statements. This means that every balance shown on the financial statements (Income Statement, Balance Sheet, Trial Balance Report, Cash Flow Report) will display their balances in the base currency.
Current Year Earnings and Retained Earnings are equity accounts seen on the balance sheet whose balance is calculated automatically by taking the sum of the Income statement (total income-total expenses). So basically, at any point prior to closing out a financial year, the total you see at the bottom of your income statement all flows into that one account on the balance sheet.
Since all the foreign currency conversion happens prior to any balances making it to the income statement, there is no reason to set up a separate Current Year Earnings and Retained Earnings account for each currency. So at no time should equity accounts be set up in a separate currency as it is not required and will cause an imbalance.