A possible reason for the out-of-balance condition is that one or more prior year entries were made after the prior year was closed. In that instance, Retained Earnings has not been updated, resulting in the out-of-balance condition. An easy test to determine if this is the cause is to go to Tasks > Close Year. You do not need to fear inadvertently closing the current year, because if there are prior year entries, the system will notify you that prior year entries have been made and need to be closed to Retained Earnings, and will display the amount proposed to be posted to Retained Earnings. Before you close out those prior year entries, you can print a report of the activity that resulted in the prior year retained earnings adjustment.

I have identified that the imbalance is equal to rejected entries for a year prior to the prior fiscal year, not sure how to correct.

What is the source of those rejected entries? I would speculate that they the Application of Origin is AP, and they are from either edited or deleted AP Invoices, where the accounting date was not changed to a current date when prompted for the reversing date. The system will not allow you to post entries. for more than one year prior to the current year, so those entries will never post. Go to General Ledger > Reports > Entries > Entries by Account. Choose the "New" transaction file (unposted entries) and enter the date range for the year two years prior to your current year. You will then have the detail with totals by account showing the accounts affected. Search the Sage Support knowledge base for article ID 50280. That article references two additional articles that should be of help. The steps required to make these changes are technical, and if you don't feel comfortable making these changes, you should consult your Sage Business Partner or Consultant, of by contacting Sage Technical Support.