Odoo Accounting Migration - Opening Balance Journal Entries
Updated: May 24
Before Go Live with Accounting, it is an essential step to migrate of the opening balances from the external system to Odoo, unless, you don't mind to manually create all the invoices, payments, etc, from the scratch and all over again.
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Opening balance is the credit and debit balances in the GL that was brought forward from old accounting period to the new accounting period. Similarly, to start using Accounting, before the financial year closing, opening balances migration will allow you to have your retained earning, payable, receivable, etc. from the old system, into the Odoo.
One of the migration method is to create the opening balance journal entries, amongst others. There are 3 approaches of Accounting data migration:
1) Migrate via the opening balance journal entry, as example below.
2) Migrate the invoice and vendor bills that are open, along with the opening balance.
You may write a migration script with xmlrpc to read from the excel migration data and update to the database.
3) Migrate all the invoices, vendor bills, payments and journal entries for X years, along with opening balance.
Opening Balance Journal Entry migration
The accountant will have to prepare the opening balances, something like below (over-simplified version).
Pre-requisite is that the Chart of Accounts are already been migrated.
Opening Journal Entry will typically use the Miscellaneous Journal type.
For each Account Payable (AP) and Account Receivable (AR), the partner (company) must be entered, so that you may reconcile it when the payment is made.
For AP, you will credit and for AR, you will debit it.
You must credit to a "Retained Earning" account to balance it, because total Debit must be equivalent to Total Credit.
If it is a foreign currency (eg, USD), you may want to enter the USD amount in the "Amount Currency" and the converted amount in the Debit or Credit.
For the depreciation of asset, credit it to the Depreciation account and debit to the Asset account.
Once the opening journal is posted, Odoo Accounting is ready to use.
Having said that, because historical opened Invoices or Vendor bill are not migrated, but merely the migrated Account Payable or Receivable's journal entries, when you have received the payment from Customer, or make payment to Vendor, you will have to do the manual payment matching.
The drawback of the Opening Journal entries are the lack of the historical data and thus the user will have to use the old system and Odoo in parallel, for a couple of months, as accounting data are only available in the old system.