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May 9, 2014

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Reconciling Your Accounts in QuickBooks

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Reconciling your accounts in QuickBooks can be very important.  One of the main reasons you reconcile is to give yourself a true picture of where you stand with your finances.  Many people don’t reconcile and rely on their bank balance; this can be very dangerous.  Some of the reasons you reconcile your accounts is to […]

Reconciling your accounts in QuickBooks can be very important.  One of the main reasons you reconcile is to give yourself a true picture of where you stand with your finances.  Many people don’t reconcile and rely on their bank balance; this can be very dangerous.  Some of the reasons you reconcile your accounts is to make sure duplicates charges or deposits were not entered, make sure there are no entries missing, and to make sure charges or deposits clear the bank.  Here are some things to keep in mind when reconciling:

1.  Make sure your beginning balance is correct – When starting to process a reconcile this very first thing is to match up the beginning balance on a statement with what QuickBooks says your beginning balance should be in a reconcile.  If this balance is off that typically means a transaction that was already reconciled has been altered or deleted.  In QuickBooks desktop you can run a discrepancy report that will show you what changes have been made since your last reconcile.

2.  Reviewing Uncleared Transactions – After you have gone through the reconcile and checked everything off that was on the statement and you have your difference down to $0.00, now its time to look at what isn’t checked off.  This is one of the reasons why you reconcile.  You could have a duplicate transaction in which case you would verify it is a duplicate and then void the transaction.  Maybe a deposit didn’t clear, which would be very concerning, but at least you caught it and are able to address it with the bank.  Be careful when dealing with old transactions from previous years.  If the taxes have already been done you may be making things worse if you void or delete these transactions.

3.  The reconcile function has multiple uses – Reconciling isn’t just limited to bank accounts and credit card accounts.  Reconciling can be done on a few other balance sheet type accounts. For example, if you have any type of loan such as a car loan you can use the reconcile function to make sure you have property accounted for Principal and Interest.

If you are ever doing a reconcile and you find yourself at a point where you are not sure what to do, make a call to OSS Office Support Services!  We can come to your office, help you handle certain accounting situations, and show you ways to be more efficient!