@TreasurerofSSAI 

Since you never reported the reserve expense in previous years, your retained earnings (R/E) is overstated by the amount that should have been expensed.  So, for the previous years’ expenses, create a JE that debits R/E and credits your Replacement Reserve equity account.  That will keep the previous year’s Replacement Reserve Expense off your P&L but will properly increase the Replacement Reserve equity account.  

Then, for the current year, create a JE that debits your Replacement Reserve Expense account and credits Replacement Reserve equity.  In the future, it’s best to make a monthly JE for the expense and equity.