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QuickBooks Tips Blog

QuickBooks Reconciliation: Are You Utilizing It Properly?

Posted by Matt Roberge on Oct 8, 2012 7:54:00 AM

One of the most powerful and important features in QuickBooks is its ability to reconcile your
balances. This means, in short, ensuring that all your transactions add up to what you think they do, and confirming that the amount you believe you have matches what is actually in your account. QuickBooks reconciliation is vital to properly keeping your books, and keeping your accountant happy.

However, there are also a lot of ways to misuse QuickBooks reconciliation, or to not get the most useful results from it. You don't want to risk your books getting unbalanced! So, here are a few bookkeeping mistakes you should make sure to avoid when using the QuickBooks reconciliation function.

Improper Uses of QuickBooks Reconciliation To Avoid

  • Not reconciling loans. It's easy to remember to reconcile your bank accounts and credit cards. However, many people don't realize you can also reconcile your loans as well. While not directly affecting your current balance, this allows you to make sure that your long-term financial forecasts are accurate. Basically, anything with a monthly or quarterly statement should be reconciled.

  • Mis-entering bank charges. When doing your reconciliation, it's important to accurately include any relevant bank charges relating to the account. This is extremely easy to overlook, and it's the sort of discrepancy that you can spend a lot of time tying to track down before you find it.

  • Mixing Credits and Debits reconciliation. Be systematic when you're reconciling your balances. Reconcile your deposits and credits first, and once that's accurate, then reconcile your checks and other payments. Doing it step-by-step reduces the amount of ground you have to cover if a discrepancy occurs.

  • Forgetting un-deposited funds. This is another easy error that can create annoying discrepancies. Before you reconcile, go to Banking and then Make Deposits, and see if anything is listed there. Make sure everything is properly deposited before you reconcile to avoid errors.

  • Not banking online. While this may not be available with all banks, an increasing number have online banking systems that can sync directly to your QuickBooks file. This can make the reconciliation process far faster and easier.

Reconciliation is a simple, but vital process. As long as you're careful and do it frequently, you shouldn't have to worry about your books not adding up.

There are still plenty more great strategies for getting the most out of QuickBooks reconciliation. What strategies have you discovered?  

 

 

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Topics: QuickBooks Reconciliation, Bookkeeping Processes, bank reconciliation, bookkeeping needs, bookkeeping challenges, Bookkeeping mistakes, Bookkeeping Business