Tuesday, September 7, 2010

QuickBooks Bank Reconciliation Issue — Bank Reconciliation Doesn't Match Balance Sheet

Q Each month I print my bank reconcilation reports for the file and the Balance Sheet, and everything matches. My Accountant just came in to review the past six months of activity and when we create the Balance Sheet now, the amounts do not match the bank reconciliation reports - for any of the months! How do I explain this?

A The short answer is that something (or several entries) have changed. Typically this happens when additional transactions are back dated into the prior period after the reconcilation reports are run. Or that an outstanding check is voided from the previous period. If you are using Premier or QuickBooks Enterprise Solutions the easiest way to find the change is:

1. Create a reconcilation report for comparison purposes: Choose Reports > Banking > Previous Reconcilation > Choose the Account > Detail > Transactions cleared plus any changes made to those transactions since the reconciliation.

2. By comparing this current report with the report that was printed at the time of the reconcilation (or you can also print the PDF of the transactions cleared at the time of the reconcilation if you did not print it at the time) the changes will become obvious.

3. To further understand what happened, choose Reports > Accountant and Taxes > Audit Trail and modify the report for the changed or new transaction. This will provide the date and time of any changes to the transaction including who made the change. What you should notice is that the date and time is later than that on the reconcilation report that was original printed, hence the difference.

1 comment:

Anonymous said...

This is a very helpful article on bank reconciliation. Those who work for outsourced accounting services are surely grateful of this. Thank you for sharing.