New Accounting Experience - Adjustment Entries with Skipped Transactions
I wanted to provide a bit more detail about the adjustment entries that you may have noticed since we’ve updated your Wave account to the upgraded accounting experience.
We created these entries to account for discrepancies between how we calculated things in the old accounting experience compared to the new upgrade. These include things like:
- Changes to the way invoice and bill totals are calculated. This is not an issue for most invoices and bills, but in certain situations can result in changes of a penny or two, particularly when there are many line items on the invoice.
- For users who do business in multiple currencies, we’ve enhanced how we calculate gain and loss for invoice and bill payments, as well as transfers. We’ve added adjustment entries to ensure that your books match the old system up until the time your account was updated. Going forward, gain and loss on foreign currency will use our new and improved calculations to ensure your gain and loss reporting is more accurate than ever.
There are also a few cases where we had to “skip” certain transactions that aren’t valid in the new system. In these cases, the adjustment entries will also account for these skipped transactions to ensure that your yearly reporting remains consistent. Typically, skipped transactions are transactions where the bookkeeping information wasn’t valid, like:
- Single side transfers: In rare situations, the old system might have allowed you to create a transfer with only one side in Wave’s system. The upgraded accounting solution does not allow for transfers unless they are a pair, so we removed the transaction and used the adjustment entry to keep your books balanced.
- Transfers between the same account: The old accounting platform allowed you to create a transfer from an account to the same account. This typically doesn’t have a bookkeeping impact and will not result in your adjustment entry being modified. Because of this, the upgraded system doesn’t allow for transfers between the same account, and so we’ve removed these transactions.
- Transactions where the account and category are the same: Similar to transfers between the same account, this transaction never has a bookkeeping impact, so we simply removed these transactions during the update. These transactions won’t be possible in the upgraded system.
- Invalid moved transactions: In the previous system Wave allowed you to move imported transactions from one business to another business or your personal account. In rare cases, we found transactions like this that were associated with an account from Business A, and a category from Business B. Because this is an invalid transaction (transaction categories and accounts must be from the same business), we can’t recreate these transactions. We’ve removed them and incorporated their value into the adjustment entries as needed.
- Other issues: There were a few very rare transactions that ended up in a broken state on the old system. These transactions are usually considered invalid in the upgraded experience, and cannot be migrated. We’ve also included the value of these transactions in your adjustment entries to keep your books balanced.
We made these adjusting entries to ensure your reports and balances stay the same and indicate the information you entered in your Wave account, while reflecting accounting best practices. As always, we welcome any feedback you'd like to offer. If you have any questions, comments, or concerns, please feel free to let us know below.