Adjusting Entry

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The following article is from The Great Soviet Encyclopedia (1979). It might be outdated or ideologically biased.

Adjusting Entry


(Russian, storno, from Italian storno, bookkeeping transfer), a bookkeeping procedure generally intended to rectify an incorrect entry.

Only one kind of adjusting entry is customarily used—the reversing entry, a supplementary entry in which the same absolute number is kept but the sign is reversed, in order to correct an error. The incorrect entry is thus canceled. The numbers reversed are usually written in red ink so that they will stand out; thus, reversing entries are sometimes known as red-ink entries. A partial adjusting entry can also be used; here, the original error is not canceled but merely altered.

In making an adjusting entry, it is necessary that reference be made to the entries being corrected or adjusted.

The Great Soviet Encyclopedia, 3rd Edition (1970-1979). © 2010 The Gale Group, Inc. All rights reserved.
References in periodicals archive ?
All documentation and adjusting entries should be prepared at the time of the loan.
Notice that the adjusting entries for unrealized profit (Year 1) and realized profit (Year 2) in Panel A of Exhibit 4 are identical to the adjusting entries for unrealized and realized profit in Panel A of Exhibit 2, except for the amounts.
Adjusting entries are the final step in accrual accounting.
If proposed audit adjustments should be subjected to the same standards as nonattest services, then the third situation described above requires the auditor to consider whether independence is impaired and to address the issue every year when preparing material audit adjusting entries that are submitted to the client.
However, at year end, when preparing the trial balance along with the closing and adjusting entries, an accountant may discover other errors.
The introductory course should do one thing: teach the basic foundation of accounting, also known as bookkeeping, and then go a little past that to incorporate adjusting entries, and other topics.
In addition, students discuss in class how they will present the adjusting entries and the resulting financial statements to Hydromaint's owners/engineers and bookkeeper and are continually reminded of their responsibility to various users of financial information such as investors, creditors and suppliers.
Some of the new or expanded steps will include determining how the client prevents, deters, and detects fraud; increasing independent verification, physical observations, and sample sizes; making unannounced visits and surprise tests; performing a detailed review of closing entries and increasing reviews of end-of-period adjusting entries.
The case study's staff accountant was too concerned with adjusting entries and not concerned enough about the apparent indication of fraud.