diff --git a/stock/doctype/stock_reconciliation/stock_reconciliation.js b/stock/doctype/stock_reconciliation/stock_reconciliation.js
index 4a66c3c3f9e..1847864ff18 100644
--- a/stock/doctype/stock_reconciliation/stock_reconciliation.js
+++ b/stock/doctype/stock_reconciliation/stock_reconciliation.js
@@ -30,6 +30,7 @@ erpnext.stock.StockReconciliation = erpnext.stock.StockController.extend({
 		var me = this;
 		if (sys_defaults.perpetual_accounting) {
 			this.frm.add_fetch("company", "stock_adjustment_account", "expense_account");
+			this.frm.add_fetch("company", "cost_center", "cost_center");
 		
 			this.frm.fields_dict["expense_account"].get_query = function() {
 				return {
diff --git a/stock/doctype/stock_reconciliation/stock_reconciliation.py b/stock/doctype/stock_reconciliation/stock_reconciliation.py
index c91344f62fb..52542ebe0d1 100644
--- a/stock/doctype/stock_reconciliation/stock_reconciliation.py
+++ b/stock/doctype/stock_reconciliation/stock_reconciliation.py
@@ -17,6 +17,7 @@ class DocType(StockController):
 		
 	def validate(self):
 		self.validate_data()
+		self.validate_expense_account()
 		
 	def on_submit(self):
 		self.insert_stock_ledger_entries()
@@ -299,12 +300,7 @@ class DocType(StockController):
 	def make_gl_entries(self):
 		if not cint(webnotes.defaults.get_global_default("perpetual_accounting")):
 			return
-		
-		if not self.doc.expense_account:
-			msgprint(_("Please enter Expense Account"), raise_exception=1)
-		else:
-			self.validate_expense_account()
-			
+					
 		if not self.doc.cost_center:
 			msgprint(_("Please enter Cost Center"), raise_exception=1)
 		
@@ -327,13 +323,19 @@ class DocType(StockController):
 			self.sync_stock_account_balance(warehouse_list, self.doc.cost_center)
 			
 	def validate_expense_account(self):
-		if not webnotes.conn.sql("select * from `tabStock Ledger Entry`"):
+		if not cint(webnotes.defaults.get_global_default("perpetual_accounting")):
+			return
+			
+		if not self.doc.expense_account:
+			msgprint(_("Please enter Expense Account"), raise_exception=1)
+		elif not webnotes.conn.sql("""select * from `tabStock Ledger Entry` 
+				where ifnull(is_cancelled, 'No') = 'No'"""):
 			if webnotes.conn.get_value("Account", self.doc.expense_account, 
 					"is_pl_account") == "Yes":
 				msgprint(_("""Expense Account can not be a PL Account, as this stock \
-					reconciliation is an opening entry. Please select 'Temporary Liability' or \
-					relevant account"""), raise_exception=1)
-			
+					reconciliation is an opening entry. \
+					Please select 'Temporary Account (Liabilities)' or relevant account"""), 
+					raise_exception=1)
 		
 @webnotes.whitelist()
 def upload():
diff --git a/stock/doctype/stock_reconciliation/stock_reconciliation.txt b/stock/doctype/stock_reconciliation/stock_reconciliation.txt
index a00547c5b31..2891ad260a0 100644
--- a/stock/doctype/stock_reconciliation/stock_reconciliation.txt
+++ b/stock/doctype/stock_reconciliation/stock_reconciliation.txt
@@ -2,7 +2,7 @@
  {
   "creation": "2013-03-28 10:35:31", 
   "docstatus": 0, 
-  "modified": "2013-08-07 11:14:17", 
+  "modified": "2013-08-07 18:16:18", 
   "modified_by": "Administrator", 
   "owner": "Administrator"
  }, 
@@ -109,6 +109,13 @@
   "label": "Expense Account", 
   "options": "Account"
  }, 
+ {
+  "doctype": "DocField", 
+  "fieldname": "cost_center", 
+  "fieldtype": "Link", 
+  "label": "Cost Center", 
+  "options": "Cost Center"
+ }, 
  {
   "doctype": "DocField", 
   "fieldname": "col1",