Reversing Journals are special journals that are automatically reversed after a specified date. They exist only till that date and are effective only when they are included in reports. These are used in interim reporting in the course of the financial year where accruals are to be reported. These accruals are usually short term and are cleared in the subsequent period. However, to get a proper perspective, decision makers require the reports with full impact of all aspects and transactions.
To activate Reversing Journals,
Go to Gateway of Tally
Select F11: F1: Accounting Feature
Set Use Reversing Journals & Optional Vouchers? to Yes.
Accept the screen to save.
You may use reversion journal for accounting for or providing for depreciation. Since, depreciation is usually provided during at the end of the year, using the Reversing journal you may include them for monthly reporting or a specific period to give more accurate status or position.
Let us take an example:
On 30th June you want to view the Balance Sheet but June month’s rent is not been paid. You may create a Scenario (refer Scenario Management for more information) and pass a Reversing Journal entry to view the reports which will be effective up to the applicable date. When you view the Balance Sheet, Tally.ERP 9 displays the report with the reversing journals included. The voucher affects the report only for that day, 30th June.
Applicable up to
The reversing Journal is available for inclusion in a scenario report till this date. The Reversing Journal can be created as of a particular date and made Applicable up to a different date.
Reversing Journal Register
All vouchers are maintained in a Reversing Journal Register. These are not posted to any books of accounts and cannot be included in regular reports. They can only be seen using a scenario.
Go to Gateway of Tally> Display> Exception Reports> Reversing Journals