This article explains how to create journal entries in FreeAgent.
Journal entries are a way of moving an amount from one account category to another.
Please note that you can move certain figures between categories without creating journal entries. For example:
However, there are occasions where you would have to create journal entries, for example if you need to make an adjustment in a VAT-locked period, record weekly payroll or adjust your Corporation Tax liability in FreeAgent. You’ll need full (level 8) access to your FreeAgent account to create journal entries.
We recommend that you speak to your accountant about whether you need to create journal entries and which journals are required before following the steps below.
For information on how to edit or delete existing journals, please see this article. For information on how to copy or reverse journal entries, please see this article.
How to create journal entries
Navigate to the 'Accounting' tab at the top of the screen and select 'Journal Entries' from the drop-down menu.
Select ‘Add New Journal Entries’ in the top-right.
Next, enter the details of the journal entries as advised by your accountant.
Enter a description and choose a date
Enter a description to identify what the journal entries relate to and choose the relevant date to create them in your accounts.
Choose the relevant codes
When moving an amount from one category to another there needs to be equal debit and credit entries.
Select the relevant categories using the ‘Code’ drop-down menus and enter the amounts that are debits and credits into the appropriate fields. You can also enter ‘Additional information’ for each entry in the fields provided if you wish.
If you need to create additional journals, for example if you're moving an amount from one category into two separate categories, select ‘Add Another’ and enter the relevant information.
The debit and credit balances of the journals must be equal for you to be able to create the journal entries. If these balances don’t match, the value of the difference will be displayed in red below the journals.
Once the debit and credit balances are equal, the ‘Difference’ will be zero and displayed in green. Once you’re happy with the journals, select ‘Create Journals’ to complete the process.
You can view these new journal entries by navigating to the 'Accounting' tab at the top of the screen and selecting 'Journal Entries' from the drop-down menu.
You will see a record of the journal entries being created in the ‘Audit Trail’ report.