This video will walk through the process of reconciling Bank Accounts.
Video Transcript:
In this video, we'll walk through the process of reconciling your bank accounts.
By the end of the video, you'll know how to confirm that your accounting records accurately match your bank statements.
Bank reconciliation is the process of verifying that all transactions recorded in the system match the transactions shown on your bank statement for a specific period, typically one month. The goal is to identify any discrepancies, such as missing transactions or errors, and resolve them by reviewing and correcting those differences. Once the reconciliation is complete, your accounting records and your bank statement should be fully aligned, giving you confidence in your financial data.
To get started, navigate to your bank accounts in the system. From the left-side navigation menu, select Accounts.
Locate the bank account you want to reconcile and select the view icon to open that account.
Next, navigate to the Bank Reconciliations tab. Here, you'll see a list of any previously completed or in-progress bank reconciliations for this account.
To start a new reconciliation, make sure you have your bank statement available, then select Add Bank Reconciliation.
The beginning balance will be zero for a brand-new account. For future reconciliations, this field will automatically populate based on the ending balance of the prior reconciliation.
Enter the ending balance exactly as it appears on your bank statement.
Then, enter the statement end date, which is typically the last day of the month shown on the statement. Once all fields are complete, select Save to continue.
Your new bank reconciliation will appear in the grid with a status of In Progress. To open and complete the reconciliation, select the view icon. Scroll down to view the applicable transactions based on the bank account and statement end date you selected. All unreconciled transactions dated on or before the statement end date will automatically pull into the grid.
Using your bank statement as a reference, work through each transaction and match it to the corresponding transaction listed in using your bank statement as a reference, work through each transaction and match it to the corresponding transaction listed in the grid on screen. For each match, select the reconcile icon on that line item to change the transaction status from uncleared to reconciled.
Continue this process until all statement transactions have been reviewed. If you make a mistake, simply select the un-reconcile icon to revert the transaction.
If you need to reconcile multiple transactions at once, select the checkbox next to each transaction. Open the bulk actions dropdown and choose Bulk Reconcile. As you reconcile transactions, you'll see select fields in the summary section update in real time, helping you track your progress.
Beginning balance, the starting balance for the reconciliation, as seen earlier.
Total deposits, the total of all reconciled transactions that increase the account balance. Total withdrawals, the total of all reconciled transactions that decrease the account balance.
Ending balance, the ending balance for the reconciliation.
Difference, the remaining difference between the beginning balance and ending balance. This must be zero to complete the reconciliation. If it's not, here are a few things to transactions that increase the account balance. Total withdrawals, the total of all reconciled transactions that decrease the account balance. Ending balance, the ending balance for the reconciliation.
Difference, the remaining difference between the beginning balance and ending balance. This must be zero to complete the reconciliation. If it's not, here are a few things to check. Make sure all transactions from your bank statement have been entered into the system. Look for any missing or duplicate transactions. Double-check that amounts match the bank statement exactly. Watch for timing differences, like outstanding checks or deposits in transit.
Once all applicable transactions are reconciled and the difference is zero, you're ready to finish.
Select Complete Reconciliation and confirm. Completing the reconciliation locks the transactions, preventing further matching or reconciling.
The reconciliation will be marked as reconciled and will display your name along with the date and time it was completed.
To access and print the bank reconciliation report for your records, navigate to Reports in the left-side menu.
Select the Accounting tab.
Choose View Report on the Bank Reconciliation tile.
From there, open the account dropdown and select the appropriate bank account.
Next, open the bank reconciliation dropdown and select the correct reconciliation. You can identify it by the statement end date.
Finally, choose Print to send it directly to a printer, or select Export Report to download the report as a PDF.
That concludes this video on the bank reconciliation process. You've now learned how to complete a full bank reconciliation in the system. Regularly reconciling your accounts helps ensure your financial records remain accurate and up to date.