How automatic journal entries work

Once accrual accounting is enabled for a company, Re-Leased creates journal entries automatically as you work — every invoice, credit note, payment, allocation, transfer, void, and reversal posts a matched set of debits and credits to the general ledger. This article explains what triggers each journal, and lists the debit and credit lines for every event.

The reference tables below are the substance of this article. If you're new to double-entry, read the two short primer sections first. If you're comfortable with double-entry, skip to the reference.

Double-entry in one paragraph

Every accounting transaction affects at least two general ledger accounts — one is debited, one is credited — and the totals always match. In property management, this means when a tenant is invoiced for rent, revenue and receivables both increase; when the tenant pays, receivables decrease and the bank balance increases. You don't need to think about this while doing your day-to-day work — Re-Leased does it for you — but understanding what's happening under the hood helps when you're reviewing reports or troubleshooting.

Anatomy of an automatic journal

Every journal Re-Leased creates has:

A transaction date that determines which accounting period it posts to. For most events this is the source document's date (invoice date, payment date, and so on).
A source tag (Invoice, Payment, Allocation, and so on) and a reference to the source document, so you can jump from the journal back to what created it.
Two or more lines, each with a chart of account, a debit or credit amount, and optional dimensions (owner, property, tenancy, ledger).
A status of Posted (active), Reversed (superseded by a later reversal), or Reversal (created to reverse an earlier journal).

Journals are immutable once posted. To change the effect of a journal, the system posts a reversal — a new journal that zeroes out every line of the original.

General events

These events apply to all accrual accounting companies, with or without trust accounting. Where a table shows a Revenue or Expense COA, that's whichever code was selected on the invoice or bill line. Where a table shows Bank, that's the specific bank account involved in the transaction.

Invoices and bills

Invoices and bills with tax include an additional line to Tax Payable (income) or Tax Receivable (expense).

Event	Debit	Credit
Approve income invoice	Accounts Receivable	Revenue COA (and Tax Payable)
Void income invoice	Revenue COA (and Tax Payable)	Accounts Receivable
Approve expense bill	Expense COA (and Tax Receivable)	Accounts Payable
Void expense bill	Accounts Payable	Expense COA (and Tax Receivable)

Credit notes

Event	Debit	Credit
Approve income credit note	Revenue COA (and Tax Payable)	Accounts Receivable
Void income credit note	Accounts Receivable	Revenue COA (and Tax Payable)
Approve expense credit note	Accounts Payable	Expense COA (and Tax Receivable)
Void expense credit note	Expense COA (and Tax Receivable)	Accounts Payable

Allocations

Allocating a credit note to an invoice moves the balance between two receivable or payable lines without touching the revenue or expense side. The journal is a matched debit and credit on the same control account, differentiated by dimensions.

Event	Debit	Credit
Allocate income credit note to invoice	Accounts Receivable	Accounts Receivable
Delete income credit note allocation	Accounts Receivable	Accounts Receivable
Allocate expense credit note to bill	Accounts Payable	Accounts Payable
Delete expense credit note allocation	Accounts Payable	Accounts Payable

Payments

Event	Debit	Credit
Receive income payment	Bank	Accounts Receivable
Reverse income payment	Accounts Receivable	Bank
Make expense payment	Accounts Payable	Bank
Reverse expense payment	Bank	Accounts Payable

Trust/Client accounting events

These events apply only to companies using trust/client accounting. They involve trust-specific system accounts (Tenancy Funds, Bonds Lodged) and, in most cases, the trust bank account.

Trust receipts

Event	Debit	Credit
Receive payment to a tenancy ledger	Bank	Tenancy Funds
Receive payment to income suspense ledger	Bank	Suspense COA
Receive payment to expense suspense ledger	Suspense COA	Bank

Ledger operations

Event	Debit	Credit
Transfer funds between ledgers	Ledger receiving funds	Ledger releasing funds
Apply tenancy funds to an income invoice	Tenancy Funds	Accounts Receivable
Refund tenancy funds to a tenant	Tenancy Funds	Bank

Suspense resolution

Event	Debit	Credit
Resolve income suspense against an invoice	Suspense COA	Accounts Receivable
Resolve income suspense to a tenancy ledger	Suspense COA	Tenancy Funds
Resolve expense suspense against a bill	Accounts Payable	Suspense COA

Bonds

Event	Debit	Credit
Lodge a bond with the authority	Bonds Lodged	Bank
Receive a refunded bond back from the authority	Bank	Bonds Lodged

Refunds

Event	Debit	Credit
Refund an income credit note	Accounts Receivable	Bank
Refund from supplier via expense credit note	Bank	Accounts Payable

Where to see the journals

Every journal is visible in the Journals area (Accounting → Journals). Each entry shows its source, transaction date, description, and every debit and credit line. Click the source reference to open the underlying document. See Create and reverse manual journal entries and Run the Journals Report for more.