Opening Balance
An opening balance is the balance an account starts with the first time it's set up or a statement is imported, before any ongoing activity has occurred.
In short
The number an account starts from. Importing a statement means supplying its own beginning balance, and BalanceMCP checks that beginning plus every transaction equals the statement's own ending figure. For a credit card, the opening balance is entered negative, same as every other figure in the ledger's convention.
Also called: beginning balance, starting balance
An opening balance is the figure an account starts from — the beginning balance on a statement being imported, or the balance an account is assumed to hold the first time it's brought into a book. It's the anchor everything after it is measured against.
Concretely, importing a bank statement means supplying that statement's own beginning balance alongside every transaction on it and its ending balance. BalanceMCP adds the beginning balance to the sum of all the transactions and checks that it matches the stated ending balance; if it doesn't, the import is flagged rather than silently accepted, since a mismatch usually means a row was missed or duplicated during extraction.
The opening balance follows the same signed convention as everything else in the ledger — for a credit card, the beginning and ending balances on a statement both need to be entered as negative numbers, since they represent money owed, not held. Getting that sign backwards is one of the more common early mistakes, and it shows up immediately as a discrepancy that doesn't make sense until the sign is corrected.
The very first reconciliation on a newly connected account looks different from every one after it, precisely because of the opening balance: there's no prior history yet to have drifted, so that first reconciliation is really just confirming the opening balance imported matches what the bank says as of that date. Getting that one clean matters more than usual, since every reconciliation after it builds on the assumption that the starting point was right.
What people get wrong
- Entering a credit card's opening balance as a positive number instead of negative — the ledger's convention treats money owed as negative from the very first figure.
- Treating the first reconciliation on a new account like every subsequent one, when there's no prior history yet to have drifted — it's really just confirming the starting point.
- Assuming a mismatched opening balance is a minor issue — every later reconciliation on that account builds on the assumption that the starting figure was correct.
Common questions
- Should a credit card's opening balance be positive or negative?
- Negative — the ledger records money owed as a negative number, even for the very first balance on a newly connected card.
- Why does the first reconciliation on a new account feel different?
- Because there's no prior activity to have drifted yet — it's really just confirming the opening balance you imported matches what the bank says as of that date.
Machine-readable: /api/knowledge/concept:opening-balance