A journal entry records a financial event. Every event in Books, such as a bill being approved, an invoice being issued or a bank transaction being reconciled, ends up as one or more journal entries. Your financial reports are built entirely from them.
You usually don't create them yourself. Books creates most journal entries automatically:
When a bill is approved, an expense journal entry is created.
When an invoice is issued, a revenue journal entry is created.
When a bill or invoice is paid, a payment journal entry is created.
When a transaction is reconciled, a categorisation journal entry is created.
You only need a manual journal entry for things that don't fit these workflows: common examples are year-end adjustments, depreciation, accruals, reclassifications and inter-company transfers. If those terms don't mean anything to your business, you may never need this page.
Note: If you do not have strong bookkeeping knowledge, we do not recommend creating manual entries. Please ask a bookkeeper or accountant to help you.
Creating a manual journal entry
Click "Books" in the left navigation bar, then click "Journal entries".
Click "New journal entry".
Enter the date. This decides which reporting period the entry falls into.
Add a description explaining what the entry is for.
Add your line items. For each line, choose an account, whether it is a debit or a credit, and the amount. If you're not sure which side is which: debits increase assets and expenses, credits increase liabilities, equity and income.
(Optional) Attach any supporting documents.
Save the entry.
Total debits must equal total credits. Books won't save a journal entry that is out of balance. If you can't save, check your line items and make sure both sides add up to the same amount.
FAQ
Q: How do I find a specific journal entry?
On the Journal entries page, search by journal entry ID or description. You can also filter by date range, source (automatic or manual) and status. Each entry shows its ID, date, description, total amount and the module it came from, such as Bill, Invoice, Reconciliation or Manual.
Q: What happens to the journal entries if I cancel a bill or invoice?
When a bill or invoice is cancelled, any journal entries linked to it are reversed.
Q: Can I correct an opening balance with a journal entry?
No. Always correct opening balances from the Opening Balances page, not from the Journal entries page. See "Guide to entering your opening balances" under Books settings.
Questions? Chat with us by clicking on the messenger icon at the bottom right of the screen once you are logged in.