Nullify the Suspense Account Balance

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Posted on by Jainam M. Kothari

17,024 Super User 2026 Season 1

Hello Experts,

During the Business Central (BC) implementation, while uploading the opening balances, a discrepancy was identified in the inventory valuation.

As per Tally, the stock value was 380, which is incorrect.

As per Business Central, the stock value was 200, which is correct.

Due to this mismatch, a balancing figure was posted to the Suspense Account.

In the current financial year:

The stock value stands at 150, which is correct and has already been reported/submitted to the bank.

Now, the requirement is to nullify (clear) the balance in the Suspense Account arising from the initial discrepancy.

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Dynamics 365 Business Central

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AndrewThomas81 2,220 on at

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You need to identify what the difference relates to and journal correct it.

Kind Regards

Andrew Thomas FCCA MCP
YouTube - Use Business Central
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OussamaSabbouh 17,586 Super User 2026 Season 1 on at

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Hello,
If the BC inventory opening value of 200 was correct, then do not adjust inventory now just to clear suspense, especially since current stock value 150 is already correct and reported. The suspense balance is an opening balance migration difference, so clear it through a G/L Journal to the proper opening equity/retained earnings/capital adjustment account, not through Item Journal, unless your auditor specifically wants the stock subledger changed. Before posting, run Adjust Cost - Item Entries, Post Inventory Cost to G/L, then check Inventory Valuation against the inventory G/L account; if both agree, the entry should be only Dr/Cr Suspense Account 180 against the approved equity/opening balance adjustment account. Please take accountant/auditor approval, because this is accounting treatment, not a BC technical issue.
Regards,
Oussama Sabbouh

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Jainam M. Kothari 17,024 Super User 2026 Season 1 on at

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Hello @Oussama Sabbouh,

But if i Adjust the Suspense Account difference with Retained Earnings then my Profit will be changed. For e.g. if My Profit in P.Y. is 4 Cr and now i adjust 1.8 Cr from Retained Earnings then my Profit will be 2.2 Cr.

And my PY Balance Sheet and Profit & Loss Statements are audited as well. So, how can i adjust the same against the Retained Earnings?

Please Suggest.

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Gerardo Rentería Ga... 27,087 Most Valuable Professional on at

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Hi, good day
I hope this can help you, and give you some hints.

About Closing Trial Balance
About *Trial Balance by Period*
About *Fiscal Year Balance*
About *Balance Comp. - Prev. Year*

Best Regards
Gerardo

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Saif Ali Sabri 2,654 Moderator on at

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Your concern is valid. If the previous year financial statements are already audited, then you should not directly impact the audited P&L or alter the operational inventory valuation just to remove the suspense balance.
In your case, the key point is:

Current inventory in BC = 150 (correct)

Inventory subledger and valuation are already correct

Difference of 180 belongs to the opening migration mismatch

PY financials are already audited

Therefore, the suspense account should be treated as a prior period adjustment / opening balance adjustment, not as a current year operational profit or inventory correction.
Recommended Approach
1. Do NOT adjust Inventory
Do not use Item Journal or Inventory Revaluation because:

Current stock valuation is already correct

Bank reporting is already submitted

Inventory ledger and G/L should remain aligned

2. Do NOT post through current year P&L
If you post against an expense/income account, it will distort current year profit.
3. Pass adjustment through Balance Sheet Equity account
Normally, auditors recommend posting against:

Opening Balance Equity

Capital Adjustment Account

Prior Period Adjustment Account

Migration Difference Account

instead of Retained Earnings directly affecting current year profitability.
Example entry:

Dr / Cr Suspense Account 180
Cr / Dr Opening Balance Adjustment A/c 180

This keeps:

Current year P&L unaffected

Inventory unaffected

Audited operational figures intact

Suspense account cleared properly

Important Accounting Point
Retained Earnings on the balance sheet is a cumulative reserve/equity figure, not the current year operational profit itself. However, since audited statements already exist, many companies prefer creating a separate equity bucket such as:

“Opening Balance Adjustment”

“Migration Reserve”

“ERP Transition Difference”

This provides cleaner audit traceability.
In Business Central
Before posting:

Run Adjust Cost - Item Entries

Run Post Inventory Cost to G/L

Verify:

Inventory Valuation report

Inventory G/L balance

Trial Balance

If inventory reconciliation is correct, then only clear the suspense through a pure G/L entry.
Final Recommendation
This is fundamentally an accounting/audit treatment decision rather than a BC technical issue. Since audited financials are involved, obtain approval from:

Auditor

CA

Finance Controller

before posting the adjustment entry.

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Grigorios Mavrogeorgis 2,514 Super User 2026 Season 1 on at

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Hi,

since the correct stock value was already loaded in BC (200, and now 150) and reported to the bank, you do not need to touch the inventory module at all. The 180 difference is purely a G/L adjustment now.

Simplest way is to post a General Journal entry clearing the Suspense Account against an appropriate P&L account — usually a Prior Period Adjustment or Opening Balance Correction account, depending on what your accountant prefers. Something like Dr Suspense 180 / Cr Prior Period Adjustment 180 (or the other way around depending on sign).

Important to keep this entry as G/L only, do not run it through Item Journal or any inventory revaluation, otherwise it will mess up your stock value which is already correct at 150. Also worth documenting the entry with a clear Description and Document No., so during audit is easy to trace back to the opening balance discrepancy. Your accountant should confirm the offset account based on local GAAP

✅ Tick the checkbox below to mark the answer as verified, if it helped resolve your question.

Regards

Gregory Mavrogeorgis

Work: GMSOFT Limited
Blog: Inside Business Central
LinkedIn: www.linkedin.com/in/gregorymavrogeorgis

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Saif Ali Sabri 2,654 Moderator on at

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Agree with your point that the inventory should not be touched since the stock valuation in BC is already correct and reconciled.

However, posting the adjustment directly to a normal P&L account may impact the current year profitability, which can create issues when PY financials are already audited.

A safer approach is usually to clear the Suspense Account against a Balance Sheet equity-type account such as:

Opening Balance Adjustment

Prior Period Adjustment (Balance Sheet type)

Migration Difference Reserve

This keeps:

Inventory unchanged

Current year operational profit unaffected

Audit trail clean for migration-related differences

And yes, absolutely agree that:

Entry should be G/L only

No Item Journal / Inventory Revaluation

Proper narration & documentation should be maintained for audit reference

Final account selection should be confirmed by the Auditor/CA based on local accounting standards.

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YUN ZHU 101,995 Super User 2026 Season 1 on at

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This can only be adjusted through General Journals.
As for the GL Account and amounts to be adjusted, this needs to be determined by your finance department, and it's best to keep written records to prepare for audits.

Thanks.

ZHU

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Saif Ali Sabri 2,654 Moderator on at

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I agree with Mr. YUN ZHU partially, but not 100%.
Agreed
✅ The adjustment should be done through a General Journal only
✅ The final offset account should be decided by the Finance/Audit team
✅ Proper documentation should be maintained for audit purposes
Not Fully Agreed
The statement is technically correct but too general. The important accounting consideration missing is:

The adjustment should preferably be made against a Balance Sheet / Equity adjustment account, not a normal operational P&L account, because:

Inventory valuation is already correct

PY accounts are audited

Current year profit should ideally not be distorted

So, while his reply is correct from a BC process perspective, it does not fully address the accounting impact on retained earnings/current year profitability

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