Chapter 8: Introduction to Odoo 16 Storno Accounting

With Odoo16, introduced a new accounting feature Storno Accounting. Storno accounting can be defined as the process of reversing original journal account entries by adopting negative figures. This business practice of Storno Accounting is commonly used in Eastern European countries. Some countries where Storno Accounting is mandatory includes:

  • Bosnia and Herzegovina
  • China
  • Czech Republic
  • Croatia
  • Poland
  • Romania
  • Russia
  • Serbia
  • Slovakia
  • Slovenia
  • Ukraine

They consider Storno Accounting is the best practice to reverse journal entries with negative debits and credit which will not create redundant figures in the accounting system. The reversal can be for various reasons such as when any mistakes happen in the original transaction or in case the return of items refund has to be added etc. This accounting technique is also known as Red Storno since bookkeepers frequently write Storno entries in red ink. All such entries will be available in the accounting reports as red color.

To avail of these features enable ‘Storno Accounting’ from the Configuration Settings of the Odoo 16 Accounting Module.

Odoo Accounting Book

In general, when a transaction occurs, let's say an invoice is created which will affect some ledger accounts. Usually, for an invoice, the Income Accounts get credited and Account Receivable gets debited. If this transaction is reversed, what will happen is that the Income Account will get debited, and Account Receivable will be debited. But for Storno accounting for the reverse entry, Income Account will be ‘-ve‘ Credit, and Account Receivable will be ‘-ve’ Debit.

Consider an Invoice that has been added as shown below screenshot.

Odoo Accounting Book

And for some reason, if this invoice is reversed and a credit note is created and posted. Now let’s see the journal item and how each ledger is affected.

Odoo Accounting Book

For invoice, Income Account is Credited and Account Receivable is Debited, and on the reverse invoice or credit note, the opposite entry created with Income Account is Debited and Account Receivable is Credited.

On enabling Storno accounting, for reversed journal entries, the Debits and Credits are in negative figures. Create an invoice and credit note respectively for the invoice. Let’s see the ledger posting in Storno Accounting.

For invoices, initially, Income Account is credited, Tax Account is credited, and Account Receivable is debited. On reversing journal entry for Income Account and Tax Account is credited with a negative figure, and Account Receivable is debited with a negative figure. In short, the below table shows the general ledger posting and Storno ledger posting.

General Storno
Debit Credit Debit Credit
Invoice Income Account 320 320
Tax Account 48 48
Account Receivable 368 368
Reverse Invoice Income Account 320 -320
Tax Account 48 -48
Account Receivable 368 -368


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