Using journals
A journal is a standard accountancy term for a record that is used to transfer money from one nominal code (account) to another, perhaps because a transaction has been incorrectly coded.
With journals, debiting is money being added to a nominal and crediting is money being removed from a nominal.
Video: Introduction to journalsWe strongly recommend that you consult your accountant before creating any journals.
You can use journals for the following purposes:
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VAT adjustments - changes the VAT liability on a VAT return.
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Opening balances - records opening balances for existing businesses.
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Wages - records salary and tax information instead of using one of our payroll apps.
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Year End - a journal is automatically created to moves all the money from your profit and loss nominal codes to a retained profits nominal code.
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Assets and depreciation - manages the value of assets and depreciate them regularly.
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Prepayments and accruals - used to spread the annual cost or income across several accounting periods (such as an annual insurance or subscription).