Backing Out and Correcting Journal Entries

Do you ever post a journal entry and then realize … oops!? I know you might be hesitant to admit it, but it seems like everyone has to, on occasion, fix a posted journal entry. And if you are unlucky as I am, the journal entry you have to back out and/or correct will have 100+ lines. Fortunately, Dynamics GP has a feature to help you with this process.

Transactions | Financial | General


Note the “Correct” button at the top of the Transaction Entry window. When you click this button, the Correct Journal Entry window will appear.

You can then select which action to perform:

  • Back Out a Journal Entry
    • Creates one entry
      • Will create a reversal of the selected journal entry
  • Back Out and Create a Correcting Entry
    • Creates two entries
      • Will create a reversal of the selected journal entry
      • Upon saving or posting the reversal, a copy will be created of the original entry for editing

After selecting the action, you can select the year and journal entry to back out or correct. Then click OK to create the entries.

Back Out Entry Automatically Created


You can then make whatever necessary edits to the back-out entry, which is a reversal of the original entry.

Correcting Entry Automatically Created


If you choose Back Out and Create a Correcting Entry, the correcting entry will be created whenever you post or save the back-out entry. The correcting entry is a copy of the original entry, which can then be edited as needed before posting.

A few notes about using the Back Out and Correct features:

  • The following transactions can be backed out:
    • Standard
    • Reversing
    • Clearing
    • Quick Journal
  • You can back out open-year transactions and transactions in the most recent historical year
  • The following transactions cannot be backed out:
    • Voided entries
    • Consolidated entries
    • Year-end closing entries, created during year-end closing routine
    • Historical transactions
    • Clearing entries in multiple currencies
    • Clearing entries in a currency other than the functional currency
    • Transactions previously backed out
    • Transactions resulting from a previous back-out

Generally speaking, you may not want to back out or correct transactions that originate in a subledger (e.g., Payables Management or Receivables Management), as the back-out or correcting entries may cause discrepancies between the subledger and the general ledger. For this reason, you can control the ability to do this through General Ledger Setup. You can also control the ability to back out intercompany transactions. When backing out an intercompany transaction, Dynamics GP will only back out the portion in the selected company, not the portion that remains in another company.

Microsoft Dynamics GP menu | Tools | Setup | Financial | General Ledger


Simply mark the options if you choose to enable the functionality to void or correct transactions that originate in a subledger or back out intercompany transactions.

The back out and correct features discussed here do not affect the original transaction itself, thereby preserving the audit trail of the original entry. This ensures you can track the activity through the system and identify the original entry as well as the back-out entry (and also a potential correcting entry).

For more information, or for guidance on how to back out and/or correct journal entries, please contact our BKD Technologies support center at gpsupport@bkd.com.

7 thoughts on “Backing Out and Correcting Journal Entries

  1. avatarMichele Beyer

    Thank you so much. This is great. I wish there was a way to just delete something which is done incorrectly, or at least it could be by upper level management. Pet peeves of using this system.

  2. avatarSharon

    This is very helpful; however, it does not answer my question and I can’t find an answer. In my situation, the journal entry from our upload has some correct entries and some which need to be applied to a different month and the journal entry number is the same for both the July and August entries. In my example, most of the entries in the journal entry need to be applied in July and some in August. If I use the back-out and correct function, can I correct only the entries that need to be moved to August? And, when I submit a correcting entry, can I omit the July entries from the correcting entry and only post the August entries to August?

    The reversing entry option really doesn’t seem viable because the August entries do not need to move to another account, just to August.

    Any help would be appreciated.

    1. avatarChristina Phillips

      Hi Sharon-

      You may find more luck interacting in the Microsoft Community, https://community.dynamics.com/gp/p/support.aspx, as it allows for more back and forth communication and is better geared to providing answers for specific issues. In your scenario, you could choose to back out the entry but then correct the entry before posting to only move the things you wanted to (and the same goes for the correct portion of the entry). However, it seems like you would be better served by rekeying or uploading an adjusting entry as the cleanup may be as much (or more) time consuming that handling an adjustment.

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