Learn how you can fix Balance Sheet when it’s out of balance in QuickBooks Desktop:
As a QuickBooks user, you should know that the total number of assets and the amount of liability and equity must be the same in QuickBooks balance sheet. If the numbers are different, you may receive the Balance Sheet out of Balance issue in QuickBooks. Despite the changes in cash flow, on an accrual basis, QuickBooks records revenues and expenses as they happen. And in many cases, the reports may show variations in your balance sheet. However, if the same happens, you can try some DIY solutions:
- Fix basic data damage or corruptions
- Find out and fix transactions causing Balance Sheet out of Balance in QuickBooks.
Moreover, you can read out the article ahead and learn the ways in which this error can be easily tackled.
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What is balance sheet out of balance error?
Balance sheet is a statement of affairs that consists of total assets and total liabilities. It is a must that the balance of asset side and liability side should tally, and when these balances show a difference, then it is stated to be balance sheet out of balance error. This error basically means a contrast between the aggregates of assets and liabilities. This error could be seen due to various reasons, which will be discussed later in this post.
Know when the balance sheet went out of balance
- Open Reports
- Select Company and Financial
- Go to Balance Sheet Summary
- Choose Customize Report
- Tap on the Display tab
- Set the Report Basis to Cash
Make the changes in the columns as per the year/month/ week/day when the QuickBooks Balance Sheet out of Balance issue occurred. For any further information, you can go through the article till the end. Another alternative for the same can be to get in touch with our 24X7 QuickBooks error support team via our toll-free number i.e. 1-800-761-1787. We own a pool of experts and certified accounting professionals, who are ready to provide the best possible support round the clock.
Common issues leading to Balance sheet out of balance
Check if any particular type of transaction is putting the Balance Sheet out of balance. A few of the transactions that the users need to look are as follows:
An inventory return and discount on an invoice
|Possible Scenario||Suggested Fix|
|Selling one or more inventory items||In this case, draft a new invoice for sale and the discount.|
|Customer returned one or more inventory items||This case requires drafting a credit memo for the inventory return.|
|A discount item||The discount item situation requires linking the credit memo to the invoice in receive payments.|
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Unconventional inventory transactions
|Possible Scenario||Suggested Fix|
|1. Transaction that adversely affect inventory such as:|
# Transaction that drive the Quantity on hand negative
# It change the Quantity on hand for previously entered assemblies and cause the assemblies to be marked pending
# Washing transactions with + and – units of the same item on the same price
# Transactions that use a damaged item, damaged customer, or vendor
2. In case the user is having a negative inventory that affects the Cash Basis Balance Sheet. The user tired to do basic data damage troubleshooting on the company file. However, while entering inventory transactions again, the balance sheet becomes out of balance sheet becomes out of balance again.
|1. Correct transactions causing the balance sheet to be out of balance. The point to be noted here is that this might affect the financial statements for previous periods. |
2. Begin with a new data file.
In case the issue began after upgrading to newer version of QuickBooks, the user can:
# Reinstall the previous version.
# After that, the user needs to restore a backup created before upgrading.
# The user is then required to prepare the restored data file for upgrade.
# Also, upgrade the data file again into the new version.
3. In case the transaction appears to be damaged, or is causing dis-balance without being one of the types of transactions that we have mentioned above, then in such a case the user either needs to delete and recreate the transaction or else consult someone.
Another transaction can be any discount that is entered at the customer level and then applied at the job level
|Possible Scenario||Suggested fix|
|* The user having a customer with several jobs. He/she completed all the jobs and invoiced the customer, which includes all the jobs on the invoice.|
* The user received payment for the invoice, but the customer included a discount for Job A in the payment.
* User recorded the payment for the invoice and also entered the discount on the Discount/credit tab.
|* In such cases, the user is recommended to re-enter the payment and then split it among the various jobs, followed by entering the discount at the job level, in order to match it with the invoice.|
Journal Entry linked to a credit memo
|Possible Scenario||Suggested Fix|
|* The user will have an open Credit Memo and then the user entered an offsetting General Journal Entry (GJE), and then linked it to the Credit memo.||# In such a case, the user will have to edit the Journal Entry. |
# And then, move the A/R account to the source line, which is generally the first line of the GJE.
# The user should save GJE and ensure that it is still linked to the Credit Memo.
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Points to Remember
There are certain points that the users can’t afford to miss out before beginning with the process. Let us have a look:
- The user needs to modify the reported total by Year and then check if the balance sheet is back in balance
- The user can log out of QuickBooks file and then log back in, to check if the error is resolved
- Also, the user should back up the QuickBooks company file before following any troubleshooting steps
- In case the user is working in a multi-user environment, this might cause damage to the company file and the balance sheet might go out of balance. For resolving this, the user needs to fix the data damage and use the main system from where the file is hosted
- Also, ensure to verify, rebuild and check the QBWIN logs before proceeding
Quick fixation steps
Before you start with the detailed methods to get rid of balance sheet out of balance in QuickBooks issues, we recommend you to check out these basic troubleshooting steps.
- At first, the user is supposed to modify the reported total by the year and then check if the balance sheet is back in balance.
- The user needs to log out the QuickBooks file and then log back in. Moreover, the user needs to check if the balance sheet is back in balance.
- Along with that, the user is supposed to back up the QuickBooks company file before carrying out any troubleshooting steps
- If the user is working in a multi-user environment, then it might end up in damage to the company file and the balance sheet might go out of balance. The user can fix the data damage and use the main system from where the file is being hosted.
- And, the user can verify and rebuild the QBWIN logs before proceeding.
Fixing the Issue of a Balance Sheet out of Balance in QuickBooks
The process to fix the balance sheet out of balance error involves multiple steps. Each of the steps carries its own significance. Thus, we will be discussing each of the steps in detail. Let us have a look:
Step 1: You can select the year by following the below-mentioned steps
- Expand options in the drop-down and select All
- Choose Year from the Display columns
- Select OK button
- Now, compare the Total Assets and Total Liabilities to locate the year the balance sheet went out of balance.
You can select the month by following the below-mentioned steps:
- Put in the year your QuickBooks balance sheet went out of balance in the Form and the Field
- Select the right month from the display month and select OK option
- In order to find the month when the issue occurred, compare the entries – the Total Assets and Total Liabilities.
You can select the day by following the below-mentioned steps:
- Put in the week your QuickBooks balance sheet went out of balance in the Form and the Field
- Next, select the day from the Display columns and hot OK button
- To find the day on which the issue occurred, compare the Total Assets and Total Liabilities.
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Step 2: Find the transaction responsible for QuickBooks Balance sheet out of balance
After you are aware of the date when the QuickBooks balance sheet out of balance issue occurred, move on to creating a Custom Transaction Detail Report to spot the transaction triggering the error.
- Go to Reports menu and select Custom Transaction Detail Report
- Select Customize Report (in case the Modify Report window doesn’t pop up automatically)
- Tap on the Display Tab
- Go to Report Date Range and type in the date when the balance sheet was found out of balance issue occurred
- Now, set the report basis to Accrual
- Under Columns section, uncheck the boxes before Account, Split, CLR, and Class
- Check on the box before Amount
- Click OK button.
- This process will enable you spot the out of balance amount. That is the ending balance on this report.
Note: If you are unable to find the transaction that’s causing the error, you can run Customer Report, Vendor Report, Journal Report, and Other Transactions.
Filter by year
- The first step is to select all from the date drop-down menu
- And then, the user is supposed to select the Year from the display columns
- After that, click on OK tab
- Followed by comparing the total assets and liabilities to find the month the balance sheet goes out of balance
Filter by Month
- The user is supposed to mention the year where the balance went out of balance, from the field
- And then, select month from the display columns
- Now, hit OK tab
- The last step is to compare the balance of total liabilities and total assets
Filter by Week
- First of all, the user is supposed to enter the month in which balance sheet went out of balance
- And then select the week in the display columns
- Followed by clicking on OK tab
- The last step is to compare the balance for finding the week where the balance sheet mismatched
Filter by Day
- Initially, the user needs to enter the week that showed wrong balance
- And then, select the day from the display columns
- Followed by tapping on OK tab
- Lastly, the user needs to compare the balance of total assets and liabilities, to look for the day where the balance sheet was out of balance
Step 3: Check and manually fix specific data damage
Data damage causing balance sheet out of balance error may include the journal entries displaying amounts exclusive of the associated accounts, the balance sheet summary out of balance, difference in the column settings, and discrepancies in the cash and accrual balance sheets. These data issues can be fixed through manual troubleshooting.
Step 4: Re-date the transactions
- After the user detects the transaction causing the trouble, he/she requires to change the date on them. Also, the user needs to note their current dates. After that, edit the date on each of the transaction to a day 20 years in the future.
- The next step is to save each of the transactions.
- And refresh the report, in case the user is able to spot the correct transaction. The paid amount column will then be zero.
- The last step is to locate the transactions that were dated into the future and then date them back to their actual date. It should be noted that the re-dating steps re-links the transactions and can easily repair them.
Step 5: Removing and re-entering the transactions
- In case changing the dates on the transactions doesn’t work, then the user should delete and re-enter them.
It may be tough for a user to manually fix the QuickBooks balance sheet that’s out of balance without knowledge of the software. If that’s the case with you too, you can contact our 24×7 QuickBooks support team at 1-800-761-1787.
Our team of certified experts will fix the sheet out of balance issue at the earliest so that you can resume working in no time.
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