cancel
Showing results for 
Search instead for 
Did you mean: 

Offsetting GL account

Former Member
0 Kudos

Guys

Can you tell me what is Offsetting GL account ?

What is its significance

regards

sateesh

Accepted Solutions (0)

Answers (5)

Answers (5)

Former Member
0 Kudos

Hello,

Offsetting Account is used for variety of reasons and few examples are Intercompany Postings, at the time of Implementation when TB and Balance sheet are uploaded would be offset against a dummy account.

For ex. GL balances are uploaded the following entry will be generated

Salaries A/c Dr

To GL Upload A/c (Offsetting a/c)

Thanks

Para

Former Member
0 Kudos

Hi Sateesh,

Offseting gl account is nothing but the material item dont post in to our books directly without check ing the quality and quantity.For that we can off set that material in one gl account.

goods receipt time entry

Ex- Inventory ac Dr

To GR/IR ac

Invoice receipt entry

GR/IR ac DR

To Vendor ac

at last that entry will come like

Inventory ac Dr

To vendor ac

May be you can understand what i told

If you have any doubt feel free to ask

Regards

Surya

Edited by: Surya Naveen on Nov 19, 2008 12:29 PM

Former Member
0 Kudos

Dear Satish,

Offsetiing GL A/c in case of say Inventory may be:-

Consumption A/c

COGM A/c

COGS A/c

etc which is revenue in nature.

Regards,

Alok

Former Member
0 Kudos

Hello Steesh,

as swap said above that's true in accounting in broadway. It can be clearing a/c even. for ex:

Dr. Inventory a/c

Cr. GR/IR a/c

here GR/IR is clearing a/c can also treat it as offsetting a/c.

Were did you com across this, that way others can help u.

Cheers

Murali

Former Member
0 Kudos

Hi Sateesh,

The offsetting account, is the GL account in the transaction to which the second effect (DR/CR) is given.

For instance -

Purchase:

Purchase A/c Dr

To Vendor

Here VEndor A/c becomes the offsetting account for Purchase line item and vice versa.

Hope it helps. Assign pts if useful