Setting Opening Balances When You Migrate Your Books

When you start using Sedna partway through a business's life, every account already has a balance. Telling Sedna those starting numbers is called recording opening balances.

If your business is starting today, skip this guide: just record transactions as they happen. If you're switching from another tool or a spreadsheet, read on.

The one rule: end with OBE at zero

Sedna uses a holding account called Opening Balance Equity (OBE) as scratch space while you enter starting balances. Whichever method you use below:

Your OBE account must read $0.00 when you're done.

A non-zero OBE means you forgot something, usually a liability or a prior owner contribution. The size of the leftover balance is a clue to what's missing.

That's the whole job: enter your balances, then check OBE is zero. Everything else is mechanics.

Migrating from another tool: enter all balances at once

Best when you have multiple balances to seed on the day you cut over.

Open Transactions → Add journal entry. Date it to your cutover day (usually the last day of last month). Add one line per account with a non-zero balance:

• Assets (Cash, AR, Inventory, Equipment) → debit side
• Liabilities and Equity (Credit cards, Loans, Owner contributions, prior Retained Earnings) → credit side

If your prior books were balanced, this entry balances on its own and OBE never gets touched. Save as posted.

Asset example. Seeding $5,000 of cash that came from the owner:

Liability example. Recording a $10,000 SBA loan whose proceeds are sitting in checking:

In both cases the entry balances on its own and OBE is never touched.

Already migrated, just need to fix one account

Best when you're correcting or adding a single balance: you forgot a savings account, or reconciliation turned up a $50 discrepancy.

Go to Accounts, click into the account, open the ⋯ menu, and pick Adjust opening balance.

The dialog asks for:

• Adjustment amount: a change, not a target. To bring Checking from $0 to $5,000, enter 5000. If you later realize it should be $4,800, open the dialog again and enter -200.
• Effective date: when the entry is posted. Can't be in the future.
• Reason: short note for the audit trail.

Click Post adjustment. Sedna writes a balanced entry: your account on one side, OBE on the other. This is fine as long as you clean OBE up afterwards (see below).

The dialog only appears on Asset and Liability accounts. Equity and Income/Expense accounts don't have meaningful opening balances in this model.

Cleaning up a non-zero OBE

If OBE has a balance after you've entered everything, you're not done. Open Transactions → Add journal entry and post one entry that moves the OBE balance to where it really belongs:

The OBE balance and the offsetting amount are the same number. After posting, OBE returns to zero.

You're done when

• Every asset, liability, and prior owner-equity balance is entered.
• Open the Opening Balance Equity account.
• Its balance reads $0.00.

If any of these isn't true, the migration isn't complete. The size of the leftover OBE balance tells you the magnitude of what you forgot.

For more on entry mechanics, see Journal entries explained.