Reconcile is a feature in QuickBooks Online that allows you to match your transactions list to the ones the bank has. Every month you’ll Reconcile your checking and savings accounts, credit cards, PayPal, and loans. I even reconcile my current liabilities like Payroll Taxes at least once a year to make sure nothing was posted there in error.
Reconciling is a necessary process, even if you’re in Banking every day, because it’s your opportunity to double-check your accuracy. You’ll discover transactions entered twice. You’ll find transactions that you entered, but that never happened in the real world.
Most of you are already familiar with the reconciliation process, so I won’t go into detail here. If you’re not, please join me in my upcoming webinar sponsored by Divvy where I’ll demonstrate the entire process. To see these Reconciliation troubleshooting tips in action, please join me in my upcoming webinar on September 8 at 12:00 p.m. Eastern Time, "Banking Feed: Troubleshooting and Reconciling," sponsored by Divvy. You can register here.
Let’s take a look at my favorite troubleshooting tips and time-savers!
Incorrect Beginning Balance
If your Beginning Balance is wrong, it means you changed a transaction that was previously reconciled.
Don’t panic! It’s very likely that when you start the next reconciliation, the problem will fix itself. Keep an eye out for an extra transaction with an old date from a past period. Check it off, and your Difference will equal $0!
If that doesn’t work, the Errors window will show you changes to previously reconciled transactions so you can hunt down the issue.
Coding Errors
If you see the same transaction on the list twice as both a Payment and a Deposit for the same dollar amount, it means you coded the Expense as the bank or credit card account itself. Correct the target account and the extra line will disappear from the Reconciliation window.
Efficient Troubleshooting
If the Difference is not $0, first double-check the Statement Date and Ending Balance to make sure you don’t have a typo. If you made a mistake, click the Edit Info button and fix it.
If that doesn’t work, compare the Deposits total and the Payments total to your statement to see which column is off.
To locate transactions easily, you can sort the Reconcile window by Amount and Check Number as well as Date. Just click on the heading! Changing it to Amount makes it easy to scan the list for a particular dollar amount. I frequently switch back and forth to speed up my matching process.
I also use Ctrl-F (Cmd-F on a Mac) to use my browser’s Find to locate a dollar amount on the screen.
An important troubleshooting step is to click the Statement ending date link. All of the transactions after the ending date will show up. Look to see if there’s a transaction on this list dated the following month, that really should have been in the current date range. If there is, click on the transaction and edit the date to move it into the current reconciliation screen, or just check it off if there’s a reason it’s post-dated. Finish by checking the Reset statement ending date link again.
If none of these steps work, it’s time to pour through the list looking for transactions that are on the bank statement but not in QBO, or transactions in QBO that are not on your bank statement. It’s easiest to work off a printout instead of online, which is why I still have the bank snail-mail my statements every month even though I’m supergreen in the rest of my life (I even carry my own travel mug, water bottle, and silverware!).
Do you have extra transactions in the register that aren’t on the statement?
- If they’re near the statement ending date, they may just not have cleared yet. You’ll see them next month.
- If they’re checks that the payee hasn’t cashed yet, that’s fine, too.
- If they are duplicates of another transaction, decide which is correct, and delete the error.
- If they just plain don’t match anything, do some research to determine if they should be deleted. Maybe keep an eye on them for a few months. Any old transactions that aren’t reconciled throw off your bank balance and reports. Eventually you need them gone.
Conclusion
These Reconciliation troubleshooting tips will keep you from spinning your wheels so that your reconciling takes minutes instead of hours. To see them in action, please join me in my upcoming webinar on September 8 at 12:00 p.m. Eastern Time, "Banking Feed: Troubleshooting and Reconciling," sponsored by Divvy. You can register here. I’ll see you there!