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It's one of the most common questions QuickBooks Online users ask.
Differences are often caused by outstanding transactions, duplicate entries, deleted transactions, reconciliation issues or transactions recorded with the wrong date.
Before making adjustments, it's important to understand why the balances differ. Simply forcing the numbers to agree can create bigger problems later.
A bank reconciliation compares the transactions recorded in QuickBooks Online with those shown on your bank statement.
The purpose is to confirm that every transaction has been recorded correctly and that your bank balance in QuickBooks Online accurately reflects your actual bank account.
Regular reconciliations are one of the most important controls for maintaining accurate financial records.
Most businesses should reconcile every month when their bank statement becomes available.
Businesses with a high volume of transactions may choose to reconcile more frequently.
Reconciling regularly makes it much easier to identify errors, investigate discrepancies and maintain confidence in your financial reports.
Yes.
Many business owners successfully reconcile their own bank accounts after receiving the right training.
Understanding the reconciliation process is often more valuable than simply following a list of steps because it helps you identify problems before they become significant.
There are many possible reasons.
Common causes include:
The solution is to identify the underlying cause rather than forcing the reconciliation to balance.
Don't panic.
Removing the reconciled status from a transaction can affect future reconciliations, but it can usually be corrected.
The best approach depends on what has changed and whether additional transactions have already been reconciled.
Understanding what happened before making further changes will usually save time and prevent additional problems.
Bank feeds are an excellent time-saving feature, but they still require review.
QuickBooks Online imports transactions from your bank, but it doesn't always know how each transaction should be recorded.
Transactions should always be reviewed before being accepted to ensure they are categorised correctly and haven't already been entered manually.
This usually happens when transactions have already been entered manually before the bank feed was connected, or when imported transactions are added instead of matched.
Duplicate transactions can overstate both your income and expenses and affect the accuracy of your financial reports.
Learning how to use the Match function correctly helps avoid this problem.
No.
Bank feeds are designed to save time, not replace judgement.
Every imported transaction should be reviewed to ensure the payee, category, tax treatment and amount are correct.
Taking a few extra seconds to review each transaction can prevent much larger problems later.
Yes, but it should be done carefully.
Undoing a reconciliation changes the reconciliation status of previously reconciled transactions and may affect later reconciliations.
Before undoing a reconciliation, it's important to understand why it's necessary and whether there is a better solution.
Your bank account is one of the key accounts supporting your financial statements.
If it isn't accurate, your Balance Sheet, Profit & Loss and Cash Flow reports may also be incorrect.
Regular bank reconciliations provide confidence that your financial information is reliable and can be used for making business decisions.
My Cloud Bookkeeping provides free YouTube tutorials, online courses and personalised training covering bank reconciliations in QuickBooks Online.
Whether you're reconciling for the first time or trying to solve a difficult reconciliation problem, there are resources available to help you understand both the process and the reasons behind it.
