Entering Beginning Balances in Abacus Accounting

1. The following three procedures need to be performed to set up beginning balances:

• Adding Beginning Balances for the Firm
• Adding Beginning Balances for Matter Account Receivables
• Adding Beginning Balances for Trust Cash and Trust Liability Accounts

Beginning balances might not all be added into the system on the same day, but the POSTING date should always be the same for all beginning balances. For example, do not add some beginning balances as of 1/1/2017 and others as of 2/1/2017.

Adding Beginning Balances for the Firm

There are two methods for entering beginning balances for a firm.

•  Method 1: The recommended way is to use your trial balance to enter beginning balances for all asset, liability, equity, income, and expense accounts.

•  Method 2: If you do not have all of the account information, you can enter only one or a subset of the account balances along with an equity account. However, at some point all account balances must be entered in order for the financial statements to be accurate.

Method 1

1. Reconcile the cash accounts from your previous program up to the date that you are bringing the balances forward.
2. Print a trial balance report.
3. Select File > Setup > Beginning Account Balances to open the Beginning Balances window. Click Add.
   
   
   
   
4. For the first account, select the account, enter the amount, and select whether the balance is a debit or credit.
   
   
   
   
5. To add the next account balance, check Create Another and click OK. The window fields clear and you can enter the balance for the next account. Continue adding all of your firm accounts. When you are finished, uncheck Create Another and click OK.
   
   
   
   
6. The Beginning Balances window reappears with your entries listed. Ensure that Total Debits equals Total Credits. If they do not, you need to edit the account balances so that Total Debits equal Total Credits.
   
   
   
   
7. For Posting Date, select the date that you want the beginning balance to be recorded in the general ledger. Then, click Post All to post the entries.

Method 2

1. Reconcile the cash accounts from your previous program up to the date that you are bringing the balances forward.
2. Create an equity account. Name it “Beginning Balance Equity” if you like.
   
   
   
   
3. Select File > Setup > Beginning Account Balances to open the Beginning Balances window. Click Add.
   
   
   
   
4. For the first account, select the account, enter the amount, and select whether the balance is a debit or credit.
   
   
   
   
5. To add the next account balance, check Create Another and click OK. The window fields clear and you can enter the balance for the next account. Continue adding the subset of firm accounts.
6. When you are finished adding firm accounts, add the balance for the equity account. The total debits must equal the total credits, so enter the amount and select Debit or Credit so that the equity account will zero out the other accounts you added.
   
   
   
   
7. Uncheck Create Another and click OK.
   
   
   
   
8. The Beginning Balances window reappears with your entries listed. Ensure that Total Debitsequals Total Credits. If they do not, you need to edit the account balances so that Total Debits equal Total Credits.
   
   
   
   
9. For Posting Date, select the date that you want the beginning balance to be recorded in the general ledger. Then, click Post All to post the entries.

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Adding Beginning Balances for Matter Account Receivables

Adding beginning balances for the matter account receivables (the amounts billed to the client, but not yet paid) is done by adding an adjustment for each individual matter record.

1. Select Billing > Costs & Adjustments to open the Costs and Adjustments window.
2. Click Add. The Costs & Adjustments – Add window opens.
   
   
   
   
3. Complete the following settings.
   • Date: Enter the date of the balance. This is important to enter so that Account Receivables Aging is accurate.
   • Matter Number: Enter the matter number.
   • Client Expense Code: When entering the balance, use one of the following four client expense codes: (1) FEE (for the amount of the balance that is for fees billed, but not paid), (2) HCT (for the amount of the balance that is for hard costs billed, but not paid), (3) SCT (for the amount of the balance that is for soft costs billed, but not paid), or (4) LAT (for the amount of the balance that is for late charges billed, but not paid).
   • Amount: Enter the amount of the balance forward.
   • Description: Enter a description.
   • Hold Status: Leave unchecked.
   • Debit/Credit: Most entries will be a debit, unless for some reason a client has paid more than was billed.
   • Bill Type: Always set to Billed.
   • Write Off: Always set to No.
4. If you want to add beginning balances for other matter account receivables, check Create Another and click Save. The window fields clear and you can enter amounts for the next matter. When you are finished, uncheck Create Another and click Save. The Costs & Adjustments window reappears with your entries listed.
5. Highlight your entries (click Select All to highlight all entries) and click Post. Your clients now have their beginning balances entered.

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Adding Beginning Balances for Trust Cash and Trust Liability Accounts

All money in a trust account must be assigned to a matter. Beginning balances need to be entered for trust cash and liability accounts for each matter.

Enter beginning balances for all matters and for all trust accounts on the same day so that all beginning balances have the same deposit date.

1. Select Trust > Trust Deposits. The Trust Deposits window appears.
   
   
   
   
2. Click Add. The Trust Deposits – Add window opens.
   
   
   
   
3. Complete the following settings.
   • Matter Number: Enter the matter number.
   • Trust Account: Enter the trust account number for the selected matter. Abacus Gold users can have multiple trust accounts. It is important to be accurate because if you put the money into the wrong account, when you print a check the program might tell you there is no money available.
   • Amount: Enter the balance forward amount.
   • Description: Enter a description.
     
     
4. If you want to add beginning balances for trust for other matters, check Create another and click Done. The window fields clear and you can enter amounts for the next matter. When you are finished, uncheck Create another and click Done. The Trust Deposits window reappears with your entries listed.
5. For Deposit Date, select the date that you want the beginning balance to be recorded.
6. Highlight your entries (click Select All to highlight all entries) and click Post. Your clients now have their beginning balances entered. Posting generates a journal entry so that the checkbook register, trust liability account, and each matter trust activity ledger have the correct beginning balances.