Outstanding Ac/P

A small (one shareholder) Canadian corporation shows a large Accounts Payable balance as of the end of the previous year. The shareholder assures me that the company does not owe any money and cannot tell me where the balance came from except that it was carried from the next previous year.I am not sure of the proper accounting procedure to eliminate this balance. My conclusion from reading my accounting books seems to tell me to make an adjusting entry to eliminate the balance and offset with the Retained Earnings account. Will that action be according to GAAP?