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QuickBooks Tips > Accuracy Tips > 16 Bank Reconciliation Tips and Tricks
16 Bank Reconciliation Tips and Tricks
Although it may seem like drudgery, reconciling your bank account is a critical accounting task that you should carry out each month. Doing so helps ensure the integrity of your financial reports, since most of your accounting transactions ultimately affect cash in some fashion.
Further, QuickBooks is a much more powerful tool for your business if you use it to its fullest extent. Most likely you've been reconciling your bank account all along, so in this article we'll discuss the tricks and techniques you need to know to streamline the process.
If you're new to QuickBooks, you start the bank reconciliation process by having your bank statement in hand, and then choose Banking, and then Reconcile. The Reconciliation screen shown in Figure 1 appears. In most cases, you enter the ending balance from your bank statement, add any interest or fees, and then click Continue.
You mark transactions as cleared, as shown in Figure 2, and then click Reconcile Now. However, it's not always that simple, so read on to learn how to sail over any hurdles that may appear.
Figure 1: The QuickBooks Begin Reconciliation window.
Figure 2: The QuickBooks Reconcile window.
1. Locate discrepancies
From there, click the Discrepancy Report button to display the report, as shown in Figure 4. This identifies any edited or deleted transactions that may affect your reconciliation.
Figure 3: QuickBooks can help you identify edited transactions that may disrupt your reconciliation.
Figure 4: Ideally your discrepancy report should never have any transactions listed.
2. Confirm your beginning balance
3. Don't forget interest and fees
If you go this route, be sure to debit cash and credit interest income for interest earnings or credit cash and debit bank charges for any fees incurred.
4. Double-check your ending balance
5. Look for transpositions
For instance, a $63 dollar difference divided by 9 returns 7 could mean that a transaction was entered incorrectly. As shown in Figure 5, you can right-click on an amount, and then choose Edit Transaction to fix the error.
Figure 5: Right-click on an amount and choose Edit Transaction to correct a mistake.
6. Pick a side, any side
Then reconcile Checks and Payments - doing one side a time limits your search area for missing or misposted transactions.
7. Clear the decks
9. Check undeposited funds
Figure 6: Undeposited funds can pose problems with your reconciliation.
10. Hide unnecessary transactions
11. Void old transactions
Such lingering transactions are often duplicates of a transaction that cleared.
12. Clear voided transactions
13. Bank online
14. Use your keyboard
15. Walk away and come back later
16. Reconcile More Frequently