Bank Reconciliation Tips & Questions
Sections in this article
Quantity How can I clear many items at once?
Interest How can I record service charges interest?
Errors How do I fix errors in my Bank Reconciliation such as wrong statement date or wrong account balance?
Missing Transaction What if I don't see a transaction on my Bank Reconciliation I expect to see?
When doing really large bank reconciliations, it can be time consuming to have the program automatically recalculate the entire bank reconciliation every time you clear off an item. Fortunately there is an option to prevent the program from automatically recalculating the entire bank reconciliation every time you clear an item. To turn on this option, go to Setup > User Options; and check the box for Add Recalculate Button to Bank Reconciliation and click on Submit to save the changes.
Once this option is activated, the software will no longer automatically calculate the bank reconciliation when you clear off items. Instead there will be a Recalculate button shown under the bank reconciliation summary that will recalculate the bank reconciliation when clicked. Having this option turned on, will help you to reduce the amount of time it takes to create bank reconciliations since you won’t be waiting for the page to reload every time you clear an item.
Clicking on the Cleared checkbox for each item on bank reconciliations can be very time consuming if there are a large number of items to clear off. A quicker way to clear items is to use the Tab key and Spacebar. If you click the Cleared checkbox on the first item and then press the Tab key, the cursor will advance to the next checkbox, and then press the Spacebar to check or uncheck the Cleared checkbox. Working through the bank reconciliation this way is much faster than having to click the checkbox to clear each item.
Recording Services Charges and Interest
The program will handle any service charges (i.e. bank fees) or interest income for you once it is setup correctly for your bank accounts. When you create a new bank account, there is an additional asset information section that asks you for a service charge expense and interest income account. The accounts that you fill in here are going to be where the program posts the service charge and/or interest income from the bank reconciliation process.
Once you have the service charge and interest income accounts setup for this bank account, when you go to do a bank reconciliation that has interest or service charges on it; you can simply enter those numbers in the appropriate fields when setting up the bank reconciliation.
So for example, if this month’s bank statement has $20.00 service fee and $0.10 interest, you would enter those amounts into the service charge field and the interest income field on the bank reconciliation screen. Then when you reconcile, the program will automatically create a journal entry that posts the service charge and interest income to the correct accounts.
Incorrect Date or Account
If you notice errors in the bank reconciliation information such as the date is wrong or the selected bank account is incorrect, you can simply delete this bank reconciliation as long as you haven’t submitted it in a reconciled state. Then after deleting the bank reconciliation, you can go back into the bank reconciliation process and create a new one with the correct information. However any items that were previously cleared will need to be re-cleared on the new bank reconciliation.
Incorrect Bank Balance: If the bank balance is wrong, simply edit it when in the bank rec screen.
If a transaction is missing that you expect to see on the current Bank Reconciliation, it is likely because the transaction date is after the Statement Date. Or it could be due to using an incorrect Account number. If either, fix the issue as follows:
- Note the date of the bank reconciliation (Statement Date top right corner)
- Note the Bank Account listed on the reconciliation (Bank Account top left)
- Go into the missing transaction you expect to find on the Bank Reconciliation.
- Note the date of the transaction
- Note the Bank Account in the transaction. The Bank Account will be listed in the top left for both checks or deposits. It will be listed in one of the line items for a journal entry.
- If the wrong Account is listed on your transaction, if it is a deposit or a journal entry, you may edit the entry and change the account to the correct account. If it is wrong on a check, you must void the check (See two bullets down).
- If the transaction date is later than the Bank Reconciliation Statement Date, the transaction will not be on this bank reconciliation. If it was dated incorrectly and it was a deposit or a journal entry, you may edit it and change the date.
- If it is an incorrectly dated check or the wrong bank account was used, this may only be fixed by voiding the original check. To save time, mark the option to make a copy of the original bill when voiding. Then, go into the new bill and click on the link to assign check number. Enter the original check number but add a letter to the end of it. Enter the correct check date. Ensure you also select the correct bank account. Submit.
- After you have updated the transaction date for the mis-dated transaction or for which the wrong account was used, you may go back to your bank reconciliation and you will now find the missing transaction.