Reversing a Posted Entry

What "reversing" means

You posted an entry. Later you realized it was wrong. The posted entry is locked, you can't just edit the amount or delete it.

Reversing is the right way to fix it. It creates a new entry that exactly cancels the original. Both stay in the books, with a clear paper trail of what happened.

Original (wrong):
  $1,000 to Office Supplies         [POSTED → REVERSED]

Reversal (auto-generated):
  -$1,000 to Office Supplies        [POSTED, references original]

Net effect on books: zero

After reversing, you typically post a new corrected entry alongside.

Why reverse instead of edit or delete

Editing a posted entry would rewrite history. Reports you've already shared (with investors, auditors, the IRS) used the original. If the original silently changed, those reports become wrong with no notice.

Deleting would erase history. Same problem, worse: the original is gone with no trace.

Reversing is the audit-friendly answer. The original stays. The fix is visible. Anyone reading the books later understands exactly what happened.

This is the same convention used in QuickBooks, Xero, every double-entry accounting tool.

How to reverse

Reversing one entry

1. Open the entry (Transaction or Journal Entry)
2. Click Reverse
3. Confirm the reversal

BitBooks creates the reversing entry automatically. The original's status changes to Reversed. The reversing entry shows up as a new Posted entry, dated today (not the original's date), with a link back to the original.

Reversing several at once

On the Transactions or Journal Entries page, tick the rows you want to reverse, click Bulk Reverse. BitBooks creates a reversing entry for each.

Use carefully. Bulk reversing is rare; it's mostly for cleanup after a wrong-batch import.

What the reversing entry contains

Same accounts as the original, but with debits and credits swapped:

Original:

Reversing entry (auto-generated):

The reversing entry's date is today (or whatever date you specified). Its memo references the original ("Reversal of JE-000142"). The link between the two is preserved so you can navigate back and forth.

After reversing: post the corrected entry

Reversing only undoes. To replace with a correct entry, you post a new one separately.

For example, if the original was wrong because the amount should have been $100 not $1,000:

1. Reverse the original (cancels the wrong $1,000 entry)
2. Post a new entry: $100 to Office Supplies, dated correctly

Now the books show:

• The wrong $1,000 entry (status: Reversed)
• The reversing entry (status: Posted, neutralizes the original)
• The corrected $100 entry (status: Posted, the right number)

Net effect: $100 of office supplies, exactly what you wanted. Plus a clear audit trail of what happened.

When reversing isn't enough

A few scenarios where reversal alone doesn't solve the problem:

The original belongs in a closed period

If the original entry is dated in a period that's now locked (Journal Lock Date passed it), the reversing entry lands in the current period (today's date). That means:

• The closed period's books stay exactly as they were (good)
• The current period absorbs the correction (good for the audit trail)
• But the corrected entry, if dated in the closed period, can't post (locked)

The fix: post the correction in the CURRENT period too, accepting that the wrong number stays in the closed period. Or unlock the period briefly to post the correction in its original period (rewriting history, use sparingly).

The original was a category-wide mistake on many entries

If you discover that 200 entries went to "Office Supplies" when they should have been "Software Subscriptions," reversing all 200 and posting 200 corrections is painful.

The accountant move: post a single summarizing journal entry that moves the cumulative amount from Office Supplies to Software Subscriptions. The original 200 entries stay Posted (incorrectly categorized), but the books net out correctly because of the one large reclassification.

Now Software Subscriptions has the right total, Office Supplies is back to its right total. The original 200 entries stay as historical record but the net is correct.

What gets preserved

After a reversal, you can still see:

• The original entry (with status Reversed)
• The reversing entry (linked from the original)
• All metadata of both: who created, who posted, who reversed, when, with what memo
• Audit log entries for the reversal action

Nothing is lost. The audit trail tells the full story.

Common questions

"Can I reverse a Reversed entry?"

Effectively, yes. If you reverse a reversal, you're un-doing the un-do. The original is back to net effect. Mostly useful when you reversed by mistake.

"Will reversing affect prior reports I've already shared?"

The reversing entry is dated today. If you re-run a report covering today, you'll see the reversal. Reports for the period of the original (e.g., last month) include the original and, if the reversal is also in that period (it isn't by default), the reversal. By design, reports for closed periods stay stable.

"Can I reverse a Draft?"

You don't need to. Drafts can be edited or deleted directly. Reversal is for entries already Posted.

Where to go next

• Draft vs Posted for the entry lifecycle
• Period Close for how locked periods affect reversals
• Bulk Posting Drafts for the bulk operations on Drafts
• Activity Log to see who reversed what and when