---
title: "Opening entry"
description: "What an opening entry is, how it carries balance sheet balances into a new fiscal year or a new system, and how to prepare one when you migrate your books."
canonical: https://ledgeriano.com/glossary/opening-entry
language: en
publisher: "Ledgeriano"
updated: 2026-11-06
---

# Opening entry

> What an opening entry is, how it carries balance sheet balances into a new fiscal year or a new system, and how to prepare one when you migrate your books.

The opening entry starts a new fiscal year, or a new accounting system, with the closing balances of assets, liabilities and equity from the previous period. Revenue and expense accounts are not included because they were closed to retained earnings. The entry must balance and match the prior year's closing balance sheet.

There are two situations. At each year end the opening entry is a mechanical carry-forward; Ledgeriano writes it automatically when a year is closed. When you move to new software mid-life, you prepare it from the last balance sheet of the old system.

For a migration, include customer and supplier balances per party, inventory per item if you track it, and fixed assets at cost with accumulated depreciation shown separately. Then compare the new opening [trial balance](https://ledgeriano.com/glossary/trial-balance) with the old closing one line by line.

Use a dedicated date (the first day of the year) and voucher type for opening entries so they never mix with ordinary activity in reports.

## Example: opening a new year

The closing balance sheet of the previous year becomes the opening entry.

| Account | Debit | Credit |
| --- | --- | --- |
| Bank | 35,000 |  |
| Trade receivables | 40,000 |  |
| Equipment | 90,000 |  |
| Trade payables |  | 35,000 |
| Share capital |  | 60,000 |
| Retained earnings |  | 70,000 |
| **Total** | **165,000** | **165,000** |

### Why are revenue and expenses not in the opening entry?

They are temporary accounts closed at year end. The year's profit is already inside retained earnings.

### What if my opening balances do not balance?

Find the difference before posting. Common causes are missing accounts, a balance in the wrong column, or prior-year adjustments not reflected.

Guide: https://ledgeriano.com/guides/year-end-closing