FAQ - What should I record as my income carryover amount on the first day of my new fiscal year?

FAQ - What should I record as my income carryover amount on the first day of my new fiscal year?

After closing the books for the accounting fiscal year, most non-profit organizations choose to show their income that is rolled over from the previous fiscal year in their account ledgers as ‘income carry forward’.

The carryover income is the amount of funds AVAILABLE to your organization to spend. This would be the amount of your assets (bank accounts, payment processor accounts, undeposited funds, etc.) less liability/escrow amounts you owe (sales tax, state/national membership dues, credit card transaction fees due, etc.).
 
The amount to record as an ‘opening balance entry’ on the first day of your new fiscal year is calculated as your Total Assets less your Total Liabilities as of the last day of your previous fiscal year.

  1. Go to Accounting / Accounts tab.
  2. Select "enter an opening balance."
  3. Choose the proper account (Income – Carryover ledger account)
  4. Date of entry will be the first day of your new fiscal year
  5. Total is Assets less Liabilities reported as of the last day of your last fiscal year
  6. Click the Save button.

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