Bank and Checkbook Reconciliation

Bank Reconciliation

Reconciling the bank statement may be done as often as a statement is received from the bank. Holding the fiscal month open for this task is not recommended since reconciling can be done in the following month and any adjustments can be made by posting journal entries into the prior month.

The reconciliation process does not affect the general journal in any way. It does scan the journal for any activity that has not yet been brought into the reconciliation file that is maintained for each account that is balanced regularly.

Reconcile the Bank Statement

  1. Go to G/L / Checkbook Reconciliation.
  2. Select the account to be reconciled.
  3. The Checking Account Reconciliation screen appears displaying the current balance of the account. Enter the bank statement balance.
  4. Select the period to be reconciled.
  5. If this account has previously been reconciled, outstanding checks or deposits may already be displayed in the grids of the Checks or Deposits tab. To bring in the recent activity, select Refresh.
  6. Mark all checks and deposits that have cleared the bank by putting a checkmark in the Cleared column. Any void or reversing entries, which appear in red, should have offsetting entries showing. Both the original entry and the offsetting entry should also be marked as Cleared.
  7. Select Print to have the computer calculate the difference between the bank statement balance and the calculated computer balance (current balance - outstanding checks + outstanding deposits).
  8. If an entry is missing, such as a journal entry for a service charge or a check or a deposit that was missed, select Save and exit the screen. Make the necessary entries in the general ledger and then return to the Reconciliation screen. Re-enter the bank statement balance, select the appropriate period, and choose Refresh to continue with the reconciliation. When returning to the Reconciliation screen, all previously existing entries remain.
  9. When the Print screen shows a difference of zero, it is recommended to print the reports from the Print screen which shows the transactions. The cleared entries may then be deleted so the next time the account is reconciled, only the outstanding entries remain.

Note: When reconciling for the first time, there may be outstanding checks or deposits that were transactions prior to using Agvance Accounting. In this case, use Add to add these entries to the reconciliation area without affecting the general ledger account balances.

Reconcile Across Multiple Datasets

If more than one company dataset uses the same checking account, use this method to reconcile.

  1. At the Reconciliation screen, select Options. Fill in the data path of the dataset(s) to be included in the reconciliation of this account. The data path should be formatted as shown in Current Database. Include the G/L account and fiscal month from that dataset for which the activity is being captured.
  2. The next time Refresh is used, the activity from this dataset will be included in the reconciliation check and deposit grids.
  3. Reconcile.

Checkbook Reconciliation

This function may be used on any account in the general ledger, although it is most frequently used to reconcile the checking account. It is important to note that although this function copies data from the general journal into the reconciliation area of the program, it has no direct effect on the general ledger itself.

  • Current Balance – This automatically displays the current balance of the selected account once Refresh is selected.
  • Bank Statement Balance – Enter the ending balance shown on the bank statement being reconciled.
  • PeriodRefresh brings in journal activity through the selected fiscal period. Choose from Beginning Balance, specific fiscal months (1, 2, 3, etc.), and Current.
  • Mark a Range of Checks Cleared – Indicate whether the range to be marked Cleared is a range of regular checks or ACH checks. Enter the first and last check number of a continuous run of checks to be marked as Cleared.
  • Checks tab – This displays outstanding checks from the previous reconciliation. After selecting Refresh, checks written on the account through the selected period are also displayed. The sort order of this grid may be changed by selecting any of the headings to sort by that column.
  • Deposits tab – This displays outstanding deposits from the previous reconciliation. After choosing Refresh, deposits made to the account through the selected period are also displayed. The sort order of this grid may be changed by selecting any of the headings to sort by that column.
  • Refresh – Choosing this brings in any entries made to the selected account through the selected period.
  • Print – When all the checks and deposits that cleared the bank have been marked as Cleared, choose this to have the computer compare the calculated computer balance to the bank statement balance.
  • Delete Cleared – When the account has been reconciled to a zero difference upon selecting Print, choose this to delete the cleared entries. Deleting cleared leaves only the outstanding entries for the next time this account is reconciled.
  • Add – This function adds an entry to the reconciliation file without affecting the general journal in any way. This is how an outstanding check or deposit is added to the reconciliation file that may have been transacted prior to using Agvance.
  • Options – This is used to define G/L accounts in other data sets which should be scanned when Refresh is selected.
  • Cleared Check File – Some banks can provide a cleared check file to customers for account reconciliation purposes. There are currently five formats available for this file: Standard, PNC, CoBank, Wells Fargo, and Bell Bank. To be able to use this option, the bank should provide the file format for review. If an existing format does not work, the format may be added for a one-time billable fee.
  • Load File – This allows selection of a reconciliation file provided by the bank. Selection of the file marks checks and deposits Cleared based on the information in the file.
  • Edit Pending File – Edits to the existing file are allowed.