The program is operating as designed. When you begin a new year, one of the choices is New Year's Budget: Actual Amounts From Last Year. Thus, the amounts that appear on your income statement as prior year balances actually exist as "budget" figures.

Update Starting Balances does not update the budget/prior year figures. If you think that it would be important to improve this aspect of the program, please post it as a suggestion to the Recommended FN Program Enhancements forum.

The prior year amounts will be those that existed at the time "Begin a New Year" was performed. Once changes to the old year have been made, do the following steps in order to have the prior year amounts appear correctly in the new year.

1. Go to Accounts | Budgets for Accounts.

2. Select the income or expense account whose prior year balance has changed.

3. Enter the corrected figures. Note that the "budgets" screen includes fields for each month.

4. Repeat for each income or expense account whose prior year balance has changed.