Skip opening balances in QuickBooks Online, enter unpaid invoices and bills

A quiet setup decision in QuickBooks Online keeps surfacing in community threads: what to type, if anything, into the opening balance box when a customer or supplier already owes money. We reviewed the accepted guidance on the topic. It points in one direction, and that direction surprises people.

The trap sits inside the profile form

When you create a customer or supplier profile, the form offers an opening balance field. It looks helpful. Type the total the party owed on the day you started, save, and the profile shows a balance at once.

That convenience is the problem. The field accepts a single net number and nothing more. There is no invoice behind it, no bill, no date, and no item detail. Reports can show you the total, but not which jobs or purchases make it up.

Opening balances do earn their keep elsewhere. Connect a bank or credit card account during setup, and the opening figure anchors the match between your books and the statement from day one. People you trade with are a different case. Intuit’s own accepted guidance is explicit here: for customers and suppliers, leaving the field blank is the recommended route.

The accepted fix: leave the field blank

The formally accepted answer is blunt. Create the profile with the opening balance empty and save it. Then enter the real paperwork: every unpaid invoice the customer still owes on, and every unpaid bill you have not paid the supplier. Each document becomes its own transaction, dated the day the work was delivered or the bill arrived. The balance builds itself from real records rather than one faceless figure.

Two limits matter. Only enter items still open; anything paid and closed before you started belongs in your old books, not in the new file. Resist the urge to net credits against debts, too. More on that below.

Add each unpaid customer invoice

From the All apps menu, open Customer Hub, then Customers & leads, and select the customer. Use the New transaction menu and choose Invoice. Date it to the actual day you provided the product or service, not the day you happen to be typing. Repeat once per open invoice.

Add each unpaid supplier bill

The supplier side mirrors it. From All apps, open Expenses & Bills, then Suppliers, and select the supplier. From the same New transaction menu, choose Bill. Use the bill’s real date, and repeat for each bill still outstanding. Anything already settled stays out of the new file entirely.

The difference shows up when payment arrives

Money moving is where the two methods part ways.

Enter real invoices, and a payment has a home. You receive the money, apply it to the matching invoice, and the deposit lines up with the bank feed. The customer’s balance falls by that invoice, and the history shows exactly which one it settled.

Enter an opening balance instead, and there is nothing to match the money to. No invoice exists, so the payment either sits unapplied or gets thrown at a faceless total. Bank matching turns awkward, and questions like which invoice this covered have no answer inside the software.

Undoing an opening balance you already entered

If the number is already in a profile, two steps clear it properly. First, reopen the customer or supplier record, delete the figure from the opening balance box, and save. Second, open the profile’s transaction list, find the opening balance entry that field created, and delete that entry so it leaves the ledger. Clearing the box alone can leave the original posting behind, which is why the second step matters.

Once the slate is clean, enter the unpaid invoices or bills as described above. Do the cleanup before the next payment lands, so nothing gets applied to a balance you are about to remove.

Credits and prepayments deserve their own entries

The single-number trap catches money owed in your favour as well. Suppose a customer prepaid in your old system, or paid beyond what an old invoice asked. Do not subtract that from the opening figure. Record a credit memo for the customer instead, so the credit can offset a future invoice by name.

Suppliers work the same way. Enter a supplier credit rather than folding it into a balance, and give any prepayment its own transaction. The amount can then be applied to the right document when it finally arrives.

The reports that confirm the fix

Two built-in reports settle whether setup went right. The customer balance detail report, and its supplier counterpart, list every open item behind each balance. If the totals match what the parties actually owe, and every open invoice or bill appears on its own line, the profiles are clean. A balance showing with no items under it means an opening figure is still hiding somewhere, and the cleanup above applies.

The pattern holds throughout: give every amount its own dated document, and let the totals add themselves up.