Trial Balance

What is this page about: A Trial Balance is a worksheet listing all general ledger (GL) accounts and their debit or credit balances, used to confirm that total debits equal total credits. This page explains the Trial Balance's structure, how to generate and read it in Light, how zero-balance accounts are handled, how to analyze it across entities and currencies, how it relates to permanent and temporary accounts, and how to export it.

# Key takeaways

• A trial balance lists every GL account with its debit or credit balance; total debits must equal total credits.
• In Light, generate it from Planning & Reports → Reports → Trial Balance.
• The Trial Balance always shows all accounts, including zero-balance accounts — there's no hide-zeros toggle for this report.
• It's a built-in system report: it cannot be edited or deleted.
• Consolidated view adds Subtotal, Eliminations, and Consolidated columns alongside each entity.
• Choosing Entity Crcy across entities with different local currencies shows an error message rather than a silent block.
• You can compare periods (1–12 months or 1–3 years back), drill into any account's transactions, and export the report as CSV.

# On this page

• What a trial balance is and why it matters
• Trial balance structure
• Accessing the trial balance in Light
• Finding trial balance errors
• Trial balance by subsidiary
• Trial balance by currency
• Understanding permanent and temporary accounts
• Trial balance and account reconciliation
• Trial balance and financial statement preparation
• Trial balance trend analysis
• Account-level detail from trial balance
• Journal entry details
• Month-end and year-end procedures
• Trial balance export and analysis
• Frequently asked questions

# What a trial balance is and why it matters

A trial balance is a worksheet listing all general ledger accounts and their debit or credit balances. It's a fundamental internal control used to verify that double-entry bookkeeping is accurate: total debits must equal total credits. The trial balance is also the source data for preparing the balance sheet, profit and loss (P&L) statement, and cash flow statement.

# Trial balance structure

Every trial balance lists the same three core columns:

• Account number and name: each GL account
• Debit balance: populated if the account carries a debit balance (typically assets, expenses, dividends)
• Credit balance: populated if the account carries a credit balance (typically liabilities, equity, revenue)

Total debits must equal total credits. If they don't, it means errors in posting exist that must be corrected before the numbers can be trusted.

Example structure:

In this example, debits (75,000) don't equal credits (110,000) — a signal that posting errors exist and require investigation.

Good to know: A balanced trial balance doesn't guarantee accuracy. Errors like duplicate postings or posting to the wrong account can still balance out and go undetected.

# Accessing the trial balance in Light

To generate a trial balance in Light:

1. Navigate to Planning & Reports → Reports
2. Open the Trial Balance report
3. Select the as-of date
4. Select the entities to include (single entity or consolidated)
5. Select the currency: Entity Crcy (local) or Group Crcy (group)

Light then displays the trial balance with all GL accounts and balances, including accounts with a zero balance — there's no setting that hides them for this report. The Trial Balance is a built-in system report, so it cannot be edited or deleted.

# Finding trial balance errors

If your trial balance doesn't balance, work through this checklist:

1. Check that all transactions have been posted (some may still be pending)
2. Review recent transactions for duplicates or reversals
3. Check for unmatched inter-company transactions
4. Verify that all month-end accruals have been recorded
5. Look for unmatched bank reconciliations

# Trial balance by subsidiary

For multi-entity organizations, Light can show the trial balance broken out by subsidiary:

1. Open the trial balance
2. Select the entities to include, or switch to Consolidated view
3. In consolidated view, Light shows a column per entity plus Subtotal, Eliminations, and Consolidated columns
4. Each subsidiary's trial balance should independently balance

Reviewing by subsidiary helps identify which specific entity (if any) has posting errors, rather than only seeing the group-level total.

# Trial balance by currency

To view the trial balance in different currencies:

1. Navigate to Planning & Reports → Reports
2. Select Currency: Entity Crcy (local) or Group Crcy (group)
3. Light displays account balances in your selected currency

Note: If the selected entities have different local currencies, choosing Entity Crcy shows an error ("Selected entities have different currencies") and the report won't generate in that view, since there's no single local currency to display across mismatched entities. Switch to Group Crcy to combine them.

Viewing by currency is useful for:

• Verifying currency conversion accuracy
• Checking the consolidated trial balance in group currency
• Analyzing foreign subsidiary results before consolidation

# Understanding permanent and temporary accounts

As accounting background, it helps to know that every trial balance includes two types of accounts:

Permanent accounts (balance sheet accounts):

• Assets, liabilities, equity
• Balances carry forward to the next period
• Appear on the balance sheet

Temporary accounts (income statement accounts):

• Revenue, expenses
• Balances reset at year-end
• Close to retained earnings

At year-end, temporary accounts are closed to zero, and permanent accounts' balances carry forward into the next year. Light's Trial Balance report always shows both account types together as of your selected date — it doesn't have a separate "preliminary" or "post-closing" mode or label. If you need a permanent-accounts-only view after your close is complete, review or filter the report accordingly rather than looking for a distinct report state.

# Trial balance and account reconciliation

Use the trial balance as the starting point for account reconciliations:

1. Generate the trial balance

2. For each material account, reconcile:

   • The trial balance amount
   • The supporting subledger (AP aging, AR aging, fixed assets)
   • Bank statements (for cash accounts)

3. Investigate any reconciling items

4. Prepare reconciliation schedules

This process ensures your trial balance is fully supported by detailed reconciliations, not just internally consistent.

# Trial balance and financial statement preparation

The trial balance is the foundation for preparing financial statements:

1. Generate the trial balance
2. Classify accounts as balance sheet or P&L
3. Prepare the balance sheet using permanent account balances
4. Prepare the P&L using temporary account balances
5. Verify balance sheet and P&L totals

Light automates this classification and preparation, but understanding the underlying connection helps you sanity-check the output.

# Trial balance trend analysis

To compare trial balances across periods:

1. Navigate to Planning & Reports → Reports
2. Add a Comparison period: 1, 3, 6, 9, or 12 months back, or 1, 2, or 3 years back
3. Light displays account balances side-by-side
4. The report shows period-over-period changes
5. Accounts with significant changes are highlighted

Use trend analysis to investigate large movements, understand business activity, and catch errors that a single-period view might miss.

# Account-level detail from trial balance

To drill into any trial balance account:

1. Click any account on the trial balance
2. Light shows all transactions posted to that account
3. Filter by posting date, currency, amount, document type, or entity
4. Export the transaction detail as CSV

This drill-down enables rapid error-finding and substantiation, without leaving the report.

# Journal entry details

To verify that all trial balance accounts have corresponding journal entries:

1. Generate the trial balance
2. For each account, review the supporting journal entries
3. Verify amounts, dates, and descriptions match expected transactions
4. Identify if any entries are missing or duplicated

Light maintains a complete journal entry log, which feeds directly into the trial balance.

# Month-end and year-end procedures

At month-end and year-end, complete these procedures:

1. Post all transactions: ensure no pending items exist
2. Bank reconciliation: reconcile all bank accounts
3. Account reconciliation: reconcile subledgers to the GL
4. Accruals and reversals: record month-end accruals, reverse prior-month accruals
5. Generate trial balance: verify debits equal credits
6. Prepare financial statements: balance sheet, P&L, cash flow
7. Review significant items: document significant or unusual transactions
8. Sign off: document that financial close is complete

Light supports all these procedures with built-in workflows.

# Trial balance export and analysis

To export the trial balance for external auditors or further analysis:

1. Open the trial balance
2. Click the export button
3. Light downloads a CSV file with all accounts and balances

You can open the CSV in Excel or Google Sheets for further analysis. External auditors typically request the trial balance as the starting point for their audit procedures.

Tip: Document your trial balance timing and reconciliation procedures in a month-end close checklist. This demonstrates strong financial controls.

# Frequently Asked Questions

# Does Light hide zero-balance accounts on the trial balance?

The Trial Balance report shows all GL accounts, including those with a zero balance. Automatic zero-balance hiding only applies to the Income Statement and Balance Sheet reports, not the Trial Balance.

# Can I edit or delete the Trial Balance report?

It's a built-in system report, so it can't be edited or deleted.

# What happens if I select Entity Crcy for entities with different local currencies?

The currency selector shows an error ("Selected entities have different currencies") and the report won't generate in that view, since there's no single local currency to display across entities that don't share one. Switch to Group Crcy to combine them.

# What columns appear in consolidated view?

A column per selected entity, plus:

• Subtotal
• Eliminations
• Consolidated

# What comparison periods are available for trend analysis?

• Months: 1, 3, 6, 9, or 12 months back
• Years: 1, 2, or 3 years back

# Can I export the trial balance?

Yes. Use the export button to download a CSV with all accounts and balances.

# Related articles

• Reporting overview
• Balance sheet
• Profit and loss
• Custom reports and filters
• Audit-ready record keeping