What are the Balance Types?

An account can be classified as being balance forward or open item. The distinction between the two is relevant during Ledger Cleardown (LCL).

Balance forward accounts are summarized during Ledger Cleardown, regardless of the allocation markers on individual transactions. The detailed transactions are summarized into a single balance transaction per accounting period. The transactions are archived and are no longer available in certain reports or in inquiries. Profit and Loss and Balance Sheet accounts are normally classified as balance forward to minimize the number of historical transactions retained. An exception to this might be the bank account.

On open item accounts, only allocated transactions are summarized during Ledger Cleardown. Normally debtor, creditor and client accounts are open item. The bank account may also be nominated as an open item account, for reconciliation purposes.