What is QuickBooks Bank Reconciliation, +1-818-295-3510

Like in QuickBooks Desktop, bank reconciliation for your business accounting in QuickBooks Online is a separate event. It is its own module, exclusive from the chart of accounts, check register, and bank feed tools. Just because you have entered transactions into QBO using forms, the bank feed, or some third-party data fetching app, you still need to reconcile your bank accounts in QuickBooks.

Typically, you’ll be reconciling your checking, savings, and credit card accounts. Some might reconcile other current asset accounts and other liability accounts, even equity, but this article will focus on how to reconcile bank statements in QuickBooks Online. You can drop a call to this toll-free number, +1-818-295-3510 to know more about this topic.

How Does QuickBooks Bank Reconciliation Works

Here we have described the working procedure of QuickBooks bank reconciliation with some of the points; 

Import transactions

Connect QuickBooks to your bank, credit cards, PayPal, Square, and more1 and we’ll import your transactions for you. When you receive your bank statement or account statement at the end of the month, you’ll only spend a minute or two reconciling your accounts. QuickBooks organizes your data for you, making bank reconciliation easy.

Reconcile accounts

In QuickBooks, choose the account you want to reconcile. With a bank statement in hand, you can systematically check off matching transactions one by one by clicking their boxes. The bottom of the screen contains a running total of items you have checked off, and thus have been reconciled. This is useful for comparing the totals in your books to the totals on your bank statement. To complete the reconciliation, make sure the difference shown is zero.

Reconciliation reports

When you finish reconciling accounts, QuickBooks automatically generates a reconciliation report. It summarizes the beginning and ending balances, and it lists which transactions were cleared and which were left uncleared when you reconciled. This report is useful if you have trouble reconciling the following month.

Easily Identify Discrepancies

Discrepancies happen. With QuickBooks, you won’t waste time spinning your wheels. There are several reports – such as the Reconciliation Discrepancy Report, the Missing Checks Report, and the Transaction Detail Report – that can help you identify discrepancies quickly.

Work with your Accountant

Give your accountant direct access to your books so she can find the reports and information she needs when questions arise. Create a separate login for your accountant to make it easy for her to work with you. You can exchange messages and share documents directly inside QuickBooks, too.

How to Reconcile in QuickBooks Online

Follow the procedure to reconcile bank in QuickBooks Online; 

Step 1. Navigate to Bank Reconciliation in QuickBooks Online

In the left menu bar, hover over Accounting and click on Reconcile.

Step 2. Select the Bank Account to Reconcile

Choose the bank account that you want to reconcile and enter the ending account balance and date from your bank statement. You can also enter service charges and interest earned, but only if these amounts aren’t already entered in QuickBooks

Account: Select the bank account you wish to reconcile from the drop-down menu.

Beginning balance: This is the beginning balance of your bank account and must agree to your bank statement. This example is a newly opened account, so the beginning balance is zero. In subsequent months, the beginning balance will roll over automatically from the prior month’s ending balance.

The difference in beginning Balance: Once a transaction has been reconciled, the amount should never be changed in QuickBooks. If it is changed, the beginning balance on this screen will not match the beginning balance on your bank statement. When this occurs, QuickBooks will provide a warning that the beginning balance is off and provide a link for help identifying the previously reconciled transaction that has changed.

Ending balance: Enter the ending balance from your bank statement.

Ending date: Select the ending date of your statement period.

Service charge: Enter the date, amount, and expense account to charge for any service charge shown on the statement that has not already been entered into QuickBooks.

Interest earned: Interest earned on your bank balance that hasn’t already been entered in QuickBooks can be entered here.

Step 3. Begin Matching Transactions

The QuickBooks reconciliation screen contains a summary of cleared activity at the top and a detailed list of transactions at the bottom:

Cleared transactions summary: The beginning balance and statement ending balance are from the prior screen. The cleared balance is calculated as the beginning balance minus payments cleared plus deposits cleared. Payments and deposits are the sums of transactions below that have the radial button clicked. To the right of the summary is the difference between the statement ending balance and the cleared balance. This difference must be zero for your reconciliation to be finished.

List of transactions: The list of transactions includes all QuickBooks transactions in this account that have not cleared the bank prior to this statement period. Any transactions not cleared this month will appear again next month.

Radial buttons: Click the radial button on the right side of a transaction if that transaction cleared the bank on this period’s statement.

Trace the transactions from the detailed list on this screen to your bank statement. When you have a match, click the radial button next to the transaction on this screen and place a checkmark next to the transaction on your bank statement. When you click a radial button, the transaction will be reflected in the summary of cleared activity at the top of the screen.

Stepa 4. Confirm the Bank Reconciliation in QuickBooks Has a Difference of Zero

Once you have matched all transactions from QuickBooks and your bank statement, the difference shown at the top of the screen should be zero. Here is an example of the completed reconciliation for Paul’s Plumbing Chase checking account:

Checks #1002 and #1003 have not cleared the bank. This isn’t surprising since they were issued toward the end of the month. These transactions will roll over automatically to next month’s reconciliation when they will likely clear the bank.

Resist the temptation to finish without the difference is zero. The error will likely affect next month’s reconciliation and will keep accumulating, making future reconciliations harder and harder. Instead, skip to our section below for some tips for finding the difference.

Once the difference has been reduced to zero, the green button in the upper right-hand corner will become Finish now. Click this to finalize your reconciliation.

5. Review & Save QuickBooks Bank Reconciliation Reports

After clicking Finish now, QuickBooks will display a confirmation along with a link to view the reconciliation report:

Click View reconciliation report to view the report. The top of the report will display summary information similar to the top of the reconciliation screen. Perhaps the most useful information on the report is the list of uncleared, or outstanding, checks and deposits.

You should review this section every month to make sure these uncleared transactions make sense. Pay close attention to any checks that are getting very old, perhaps three months or more. Contact the employee or vendor and verify they received the check and determine if they need it reissued. I suggest stopping payment on the old check before reissuing a new one.

Once you are comfortable, the uncleared transactions make sense, and you are done with your reconciliation.