How to reconcile bank statements to QuickBooks Online

[@chirantannanavati9714]

I am zero at accounting but would like to learn and this is the first time I watch this video and seems helpful. Thanks.

[@5MinuteBookkeeping]

I'm glad it was helpful Chirantan.

[@reneidiaz6841]

I’m a new QuickBooks online user thank you

[@5MinuteBookkeeping]

You're welcome Rene.

[@elgallo6094]

I love watching your videos and your voice is very calming. Usually this is a scary process and you make this seem so easy

[@5MinuteBookkeeping]

Thanks. Glad to be of help. I try to make things simple for everyone.

[@relearnalanguage]

This video is so fantastic! It broke it down so easily :) I'm looking right now at your channel but I don't see a Part 2. Do you have a good video for what happens if we don't get our difference down to $0? I know it means we need to add or adjust journal entries, but I'm a little nervous and would love to see it done!

[@5MinuteBookkeeping]

Hi. You should always get to a 0 difference when doing the bank reconciliation. If that's not the case, you should figure out what's different. Always work from the bank statement (your source of truth) to identify any missing transactions on the books.

[@relearnalanguage]

@@5MinuteBookkeeping Thanks for replying! Yeah I more with what do do after you figure out what's different, but if you don't have a video on that no worries :) I just really like how you explain things and went through a tooooonn of videos this week!

[@texasbird3394]

1000 Thanks for this very informative video. It really helped me understand how to reconcile my quickbooks online program.

[@5MinuteBookkeeping]

Glad it was helpful!

[@mykabaum9455]

Thank you so much for your concise tutorials!!

[@5MinuteBookkeeping]

You are so welcome!

[@brynnmatthews1730]

I really appreciate this video. Thank you!

[@5MinuteBookkeeping]

You are so welcome!

[@joyelendu]

Thank you so much for making this much easy to understand. Subscribed!

[@5MinuteBookkeeping]

You're welcome! Thanks for subscribing.

[@lindahernandez475]

Thank you for explanation. I understand but now need to apply. I started reconciling on my own two months ago, but I have not reconciled for August. Where do I find those transactions in QB? I don't know how to access them.

[@5MinuteBookkeeping]

It would depend on whether you have connected QBO to your bank and credit card accounts. If you have, then you would find them in Transactions > Banking.

[@thereeldemodeal3389]

Thank you, this was very helpful.

[@5MinuteBookkeeping]

You're welcome!

[@LisaOrlicek]

Hi, I know your recommendation for catch-up bank reconciliations is to do the last month of the year but my client already filed taxes for 2023. Could I do the catch-up rec in January so that the catch-up entry (which is negative) could be on this year's books since that won't get filed until 2025? Also, could I record the entry to uncategorized expense instead of opening balance equity?

[@5MinuteBookkeeping]

If the taxes were done already for 2023, you would need to make the adjustment as of 1/1/24. Opening Balance Equity is used to temporarily record the difference until you determine the best account category to use.

[@vickilgrout5166]

I must be using an older version (I'm pretty sure that mine is 2018) because mine does not have the circled i on the top right of the screen. Can you tell me where i go in my version? Thanks in advance.

[@5MinuteBookkeeping]

Vicki, it sounds like you are using QuickBooks Desktop which is a completely different software from the QuickBooks Online version. I focus on QuickBooks Online, but check out Hector Garcia CPA's KZbin channel - he teaches QB Desktop.

[@tashadotson912]

Thank you for this video. During a reconciliation, how can I include the Excluded transactions (non--business related expenses) as they are not showing up during the reconciliation.

[@5MinuteBookkeeping]

It sounds like you have business and personal expenses mixed together. You can't exclude non-business expenses. You have to include them and record them accordingly (usually to Owner Draws) so that the bank statement can reconcile properly. But, as a best practice, business and personal expenses should not be co-mingled. The business bank account should only be used for business income and expenses.

[@5MinuteBookkeeping]

@@tashadotson912 Thanks :)

[@md.nafeezulkabirnafeez1054]

Thanks for sharing this video. I have a question. I am new to QB and maintaining few bank accounts and credit card at a time.i have been working in QB for last three months,so there are lot of transactions of the last 2 years that are yet to be reviewed. so if i need to reconcile suppose for from 1-1-2019 to 31-12-2019, do i need to review like (adding or matching) all those transactions which haven't been reviewed yet? would appreciate your valuable answer.

[@5MinuteBookkeeping]

If you have banking transactions that haven't been added to the books yet, you will not be able to do a bank reconciliation because the bank balance will be incorrect. The bank balance is a cumulative balance from day 1 and it should reflect all the transactions. In some cases, you may do a bank reconciliation and adjust the opening bank balance in QBO. Check out this blog post 5minutebookkeeping.com/reconciling-a-bank-account-that-has-never-been-reconciled-in-quickbooks-online/ . The tutorial tells you to adjust the balance to Opening Balance Equity. Ultimately, you would have to resolve that balance and determine the best way to adjust it.

[@sakinahassanali8681]

why was 4242 entered in the ending balance in the reconciliation account when the bank statement ending balance says 2082?

[@5MinuteBookkeeping]

Because the bank statement was just an example of a bank statement. Normally, you would pick up the ending balance from the bank statement as you have correctly indicated.

[@sakinahassanali8681]

@@5MinuteBookkeeping oh it was just an example. Okay thank you!!

[@sujaypandit1956]

When should we reconcile ?? last date of month or 1st of next month ? incase I am not able to do. Can I do reconciliation on 2nd as well ?

[@5MinuteBookkeeping]

If you are referring to bank statement reconciliations, you should reconcile them after you receive the bank statement from your bank.

[@waqasiqbaal]

very well explained… thanks

[@5MinuteBookkeeping]

You are welcome!

[@sunkanmibero]

Awesome video again and again.

[@5MinuteBookkeeping]

Thanks again!

[@Ddstairclimber]

veroniac one question , once you learn quick books desktop; how much , how long should you spend learning quickbooks online to be good at it?

[@5MinuteBookkeeping]

QuickBooks Desktop and QuickBooks Online are very different. Many of the concepts are the same but you will need to invest time learning QBO. I can't say how long because it's up to you, however, you should at least go through the training materials included with the free QBOA subscription.

[@amergammas9702]

If the $24.35 Hicks expense was made on 12/9 from the bank (actual outflow), then how was it cleared on 12/24? A bank statement reflects only the money actually coming in or leaving out. Or am I missing something?

[@5MinuteBookkeeping]

Hi Amer. I'm sorry but I don't understand your question.

[@saritaylor3648]

So helpful and so easy to follow

[@5MinuteBookkeeping]

Glad you think so!

[@caroleeremme825]

Question for you i am working for company that has switched to online as of January 1 2021. When they exported data from desktop to online on January 5, i am assuming it brought over bank rec detail. I want to start reconciliation for January but how do i do that with all this data sitting from the bank export back to June 2020? Thank you

[@caroleeremme825]

I guess how do you start from scratch

[@5MinuteBookkeeping]

Hi Carolee. If the company data was converted as of 1/1/21, you would exclude any transactions in the "Banking" window prior to 1/1/21.

[@caroltrimble2738]

I love this, so clear

[@5MinuteBookkeeping]

Thank you Carol.

[@jaynefranzinoromero1640]

i've learned to uses the start and end dates that the bank statement shows, and NOT the beginning and end dates of the month.

[@5MinuteBookkeeping]

Yes, you are correct. You should use the start and end dates on the bank statement.

[@tamarasersansie2211]

Veronica, I need some help. I have used QuickBooks for years, but I am new to QBO. My transactions have the little green matching symbol, but they do not show up in the reconciliation window. Where did I go wrong? I did have to edit the transactions from the bank download as there was no payee listed and the expense was not categorized. Any help you could offer would be appreciated!

[@5MinuteBookkeeping]

You may want to check out the following: -Have you added the transaction from the bank feed yet? -Can you see the transactions in the bank register? -If so, what is the date of those transactions? -Could the bank reconciliation window be excluding transactions after a certain date?

[@tamarasersansie2211]

@@5MinuteBookkeeping Veronica, some of these transactions are close to a year old. The client gave me his books that have been left unattended for awhile. The transactions were added from the bank feed. I can see these on the register. I had to go to work and didn't get to answer your post. I enjoy this resource you offer so much. It has helped me so much. I have just reached a point where I perplexed by the issue.

[@tinalarkin2147]

im trying to reconcile an account that has no transactions but displays interest which blocks me to getting to $0 difference. what to do? thanks in advance.

[@5MinuteBookkeeping]

Hi Tina. I haven't come across that issue before in QBO. Perhaps the interest should not be recorded to that account? The bank statement is always the "source of truth" when it comes to doing the reconciliation.

[@tinalarkin2147]

@@5MinuteBookkeeping thank you regardless

[@SCLana]

Most banks has one statement per month, bank Regions has statements from 15th to 15th, two months in one statement, how reconcile that? Usually i reconcile like January 1st to January 31st. Thank you

[@5MinuteBookkeeping]

I didn't know Regions does that. I would contact the bank to see if they can change the statement date. Otherwise, I would still reconcile through the end of the month.

[@rbkylebacabis6684]

why did he type in 4242.02 in the ending balance when the bank statment showed 2082.92 ? I'm so confusedd

[@5MinuteBookkeeping]

Sorry for the confusion. The "fake bank account" balance on the statement is incorrect and it should be $4242.02. The amount entered in the bank balance should be the ending bank balance on the bank statement.

[@paradisefloatspa]

I don't understand the need to reconcile between bank and QBO since it is an automated data transfer. The data transfer process should be validated. Reconciliation only makes sense if you are comparing data entered into separate places/systems that don't have a validated data transfer process.

[@5MinuteBookkeeping]

I wish that were the case but, 1) the data transfer process is not validated and there are multiple times when transactions are missing from the bank feed or duplicated, 2) a proper accounting system includes monthly bank reconciliation, and 3) the IRS expects the bank statements to be reconciled. If it were up to me, I wouldn't do bank reconciliations but I've yet to see the bank feeds be 100% correct.

[@paradisefloatspa]

@@5MinuteBookkeeping Thank you for that! So I would think what we need from QB is an automated REVERSE reconciliation tool that just spits out the discrepancies.

[@5MinuteBookkeeping]

@@paradisefloatspa I wish QBO would import the bank statements and auto-reconcile the accounts. We're far from that.

[@smartbusiness165]

No good. Did not explain if there are missing transactions on the bank feed.

[@5MinuteBookkeeping]

Thanks for your feedback. This video is about preparing a bank reconciliation and not about working with the bank feed.

[@edwardyersh8686]

Andre kinda talks funny.

[@5MinuteBookkeeping]

Thanks for your feedback. We all talk funny!

[@DanielCfK]

Andre needs a better mic, my ears hurt.

[@5MinuteBookkeeping]

Sorry about that! Perhaps you could turn down your volume. We spend many hours recording, editing, and producing videos and try our best to put out quality content. Thanks for the feedback.

[@5MinuteBookkeeping]

@Lucas Britez Thank you for your feedback. We try our best to produce quality content and we have improved our audio since then. My goal is to help business owners and not to get more subscribers.

[@5MinuteBookkeeping]

@Lucas Britez Thank you and I apologize if I lacked gracefulness in my response. You are right, more subs will help me spread my message.