Creating Manual Journal Entries

Manual journal entries allow you to record adjustments, accruals, and corrections directly in the GL. This article explains how to create and post journal entries.

# What is this page about

This page covers creating journal entries in Light: the header and line fields, the double-entry rules Light enforces, spreading a line over time, intercompany entries, and uploading entries in bulk from a CSV. Read the batch upload section carefully, since uploaded entries post straight away by default.

On this page

• When to Use Journal Entries
• Creating a Simple Journal Entry
• Entry Structure
• Double-Entry Bookkeeping
• Multi-Line Entries
• Spreading a Line Over Time with Releases
• Multi-Entity Entries
• FX and Multi-Currency
• Tax-Related Entries
• Workflow Approval for Entries
• Batch Journal Entries
• Editing Entries
• Approving and Posting
• Common Entry Templates
• Period-End Entries
• Searching Your Entries
• Validation Rules
• Related Articles

# When to Use Journal Entries

Create manual journal entries for:

Adjustments: fix errors in posting or accounts

Accruals: record expenses incurred but not yet billed, such as a rent accrual

Deferrals: spread expenses over future periods, such as an insurance prepayment

Corrections: reverse and correct prior entries

Consolidation: eliminate intercompany entries

Custom entries: any GL transaction not handled by AP, AR, or Payments

Bank reconciliation adjustments: small differences between bank and ledger amounts, such as rounding or fees

Tip: If you need to create a journal entry to resolve a bank reconciliation discrepancy (such as a small amount difference between the bank transaction and your ledger), you can use the Journal entry option directly within bank reconciliation. This creates and matches the journal entry in one step, saving you from having to manually create the JE first and then return to match it. See Resolving Discrepancies for more details.

# Creating a Simple Journal Entry

To create a basic journal entry:

1. Go to Accounting → Journal entries

2. Click Create journal entry

3. Enter details:

   • Description: what this entry is for
   • Posting Date: when to post to GL
   • Valuation date: the date used for valuation
   • Entity: which entity (for multi-entity companies)
   • Currency: currency of the entry (if multi-currency)
   • Net/Gross: whether you are entering line amounts net or gross
   • Ledger and Business partner: additional header fields available if applicable

4. Add lines:

   • Click + Add line item
   • Select Account
   • Enter Debit or Credit amount
   • Add Description (optional)
   • Repeat for each account

5. Light validates that debits equal credits

6. Click Post

The entry is now posted to the GL.

# Entry Structure

A journal entry consists of:

Header:

• Description (optional): describes what the entry is for
• Posting date (required): when it posts
• Valuation date: the date used for valuation
• Entity (required): which entity
• Currency (required)
• Net/Gross: whether line amounts are entered net or gross
• Custom properties (optional): department, project, and so on

Lines:

• Account (required)
• Debit amount (optional): if the account is being increased
• Credit amount (optional): if the account is being decreased
• Description (optional)
• Custom properties per line (optional)

Each entry must have at least 2 lines, and debits must equal credits.

# Double-Entry Bookkeeping

All entries use double-entry bookkeeping:

Example: Accrue rent expense

• Debit: Rent Expense (5000), $1,000
• Credit: Accrued Rent Payable (2500), $1,000

Both sides must balance. This ensures the accounting equation remains true.

# Multi-Line Entries

Create entries with many lines:

1. Add lines one at a time
2. View running total of debits and credits
3. Continue adding until balanced
4. Light shows an error if the entry is out of balance

Example: Month-end allocation of shared expense to departments

Debit: Department A Expense 40% - $4,000
Debit: Department B Expense 30% - $3,000
Debit: Department C Expense 30% - $3,000
Credit: Shared Expense Clearing - $10,000

# Spreading a Line Over Time with Releases

Rather than a scheduled self-reversal, Light spreads costs over time using Releases: an amortisation or accrual template applied to a line, with a start and end date, that recognises the line's amount across that date range.

To apply a release:

1. Go to Accounting → Journal entries
2. Click Create journal entry
3. Add your lines as usual
4. On the line you want to spread over time, apply a Release template and set the start and end dates for recognition
5. Post the entry

Light recognises the line's amount across the scheduled range according to the release template. See Deferred entries (accruals and deferrals) for more on how release templates work.

# Multi-Entity Entries

For multi-entity companies:

Same entity entry:

• All lines post to the same company entity's GL

Intercompany entry:

• Choose Intercompany as the document type from the "Create journal entry" dropdown (this is a separate document type, not a tab on a regular journal entry)
• Each line specifies its own company entity and a FROM/TO direction
• Consolidated reporting automatically eliminates the intercompany lines
• Light automatically adds the corresponding intercompany receivable/payable offset lines when you use the Intercompany document type

# FX and Multi-Currency

For entries in foreign currencies:

1. Select the currency (EUR, GBP, JPY, etc.)
2. Enter amounts in that currency
3. Specify posting date for FX rate
4. Light converts to local and group currencies
5. Stores all three amounts in GL

When multi-entity, each entity can have different local currencies.

# Tax-Related Entries

Some entries involve tax. For example:

Sales tax entry:

• Debit: Sales Tax Expense, $1,000
• Credit: Sales Tax Payable, $1,000

VAT entry:

• Debit: VAT Receivable, $5,000
• Credit: VAT Expense, $5,000

GL accounts typically have a tax designation for proper reporting.

# Workflow Approval for Entries

Depending on settings, journal entries may require approval:

1. Entry created in Draft status
2. You submit the entry for posting
3. Approver reviews, then approves or rejects
4. If approved, the entry posts
5. If rejected, it returns to Draft

Large entries or special types may have approval workflows.

# Batch Journal Entries

Upload multiple entries at once from a CSV:

1. Go to Accounting → Journal entries
2. Open the ⋯ menu and choose Upload
3. In the Upload journal entries drawer, click Download template to get a company-specific CSV that includes your custom properties
4. Fill in the template using display names, for example "Cost Center" rather than "cost_center"
5. Decide whether to leave Post transactions switched on
6. Select your CSV file and click Upload

Important: Post transactions is switched on by default, so your uploaded entries post to the ledger as soon as the upload completes. Switch it off before uploading if you want to review the entries as drafts first.

The import template is dynamic and includes all your active custom properties. Column values resolve like this:

• Accounts, taxes and entities: matched by code
• Release templates: matched by UUID first, then by template name
• Custom property values: matched by internal name first, then by label, ignoring case

For detailed column specifications, see Data Import and Migration Tools.

# Editing Entries

If an entry is still in Draft:

1. Open the entry
2. Edit any fields or lines
3. Add or remove lines
4. Click Save (not Post yet)

Once posted, an entry is locked. To change it:

1. Create a reversing entry
2. Create a new correcting entry
3. Or modify (see document lifecycle article)

# Approving and Posting

Once an entry is ready:

1. Click Post. Where an approval workflow applies, the button reads Submit for approval instead

2. If an approval workflow is active:

   • The entry is submitted for approval
   • Once approved, it posts
   • If rejected, it returns to draft

3. The entry posts to the GL and becomes immutable

Posting is the point of no return, since the entry is now in the permanent GL.

# Common Entry Templates

Accrual template:

Description: Monthly rent accrual - [Month]
Debit: Rent Expense (5500)
Credit: Accrued Rent (2750)

Depreciation template:

Description: Monthly depreciation - [Asset]
Debit: Depreciation Expense (5600)
Credit: Accumulated Depreciation (1800)

Intercompany allocation (use the Intercompany document type):

Description: Allocate headquarters costs
Debit: Entity A Expense (570000)
Debit: Entity B Expense (570000)
Credit: HQ Allocation Clearing (999900)

# Period-End Entries

At period-end, you may create:

Accrual entries: record un-billed expenses or unpaid revenues

Deferral entries: spread prepaid expenses to future periods

Reclassification entries: move balances between accounts

Tax entries: estimate tax liability

Create these after other transactions post but before closing the period.

# Searching Your Entries

Find created entries:

1. Go to Accounting → Journal entries

2. Filter by:

   • Status
   • Entity
   • Posting date, document date, or valuation date
   • Currency

3. Sort and review

Saved searches help for recurring review tasks.

# Validation Rules

Before posting, entries are validated:

• Balances: debits must equal credits
• Accounts exist: all GL accounts must be valid
• Period open: the posting period must be open
• Amounts entered: each line needs a debit or credit amount
• Required fields: Entity and Currency are required, and each line needs an Account and an amount

Validation prevents invalid entries from reaching the ledger.

# Related Articles

• Understanding Light's general ledger
• Accounting document types and lifecycle
• Deferred entries (accruals and deferrals)
• Immutable ledger and audit trail