How to Reconcile in QuickBooks Online: Step-by-Step Instructions

QuickBooks is an online book keeping platform that lets you manage all the accounting of your business with ease. It is used by a majority of businesses worldwide – especially the ones that use QuickBooks Intuit Point of Sales platform for their transactions.

Over the past few years, QuickBooks has made a major name for itself with various big businesses using its platforms for transacting with their customers and clients and also for managing all their accounting records. This allowed QuickBooks to function properly without causing any trouble with the business world like its competitors have.

QuickBooks is a name business can trust a lot for all their needs and their regulation. This allows QuickBooks to work as a major replacement for excel based book keeping and even allows small businesses to take over their accounts department to manage all their accounts. QuickBooks has let a majority of businesses use its platform and this led them to profit thereby generating good press for the transactional giant.

Recently, it even unveiled an easy system that lets even amateur book keepers manage business accounts like professionals. QuickBooks also offers a basic desktop-based version of its platforms for users who prefer using it offline.

Pre Requisites

1) A good laptop/PC, check some of them here

2) Working internet connection

3) QuickBooks software

Reconciliation

QuickBooks has a feature called reconciliation which is very similar to desktop reconciliation for your bank. This system when used online, is very different from the desktop-based version and allows them to work and function as separate modules. It has an exclusivity from accounting charts which also makes it independent of the check register and bank tools. If you enter your transactions into QuickBooks forms, you will realize that you will need to reconcile them into your bank account.

This is exactly what will help you to work towards building more of an urgent shipment with the QuickBooks software. Reconciling your savings account, credit card, as well as your current account will help you to easily access them via QuickBooks. You may also want to reconcile some other current assets as well as some liabilities, equities and other assets. But here, we will mainly focus only on reconciling your bank statements in QuickBooks.

Why You Should Reconcile in QuickBooks Online

You should always reconcile QuickBooks your bank statements with QuickBooks Online monthly. This should always be done instantly at the time you get an SMS alert that your bank statement is available. This is because QuickBooks matches your bank and credit card statements about what you have spent and what you have earned.

The remaining balance at the end of the previous month should be able to coincide with the initial balance at the beginning of the current month. This will help you to properly maintain your banking records in order to keep them from going into a topseyturvey of chaos. Moreover, your balance in QuickBooks online should coincide with your bank balance in the bank statement. Ensuring this will help you to know that no errors whatsoever have taken place at all.

If all your bank reconciliations are managed by your accountant, then the QuickBooks reconciliation should also be done by them. If charts of accounts in your business is held as a backbone of your entire accounts department, then you should be able to host someone to reconcile your bank records in QuickBooks to maintain this backbone of your business.

Now let’s look at the exact process of how to Reconcile in QuickBooks:

Reconciling in QuickBooks

Step 1. Go to the Reconciliation Page

The QuickBooks website has been very intuitively designed to make it easier for people to reach the reconciliation page. There are several easy methods of accessing it, but today we will only focus on two of these major methods of reconciliation: The first one involves clicking on the Accounting Tab in the left side menu which should conveniently be placed on the left side of the screen.

Once you click on it, a popup menu should appear in which you will need to click on Reconcile. The second method involves clicking on an icon which looks like a gear. This is similar to the settings icon in various other applications and it opens what is called a “gear menu”. Once the gear menu is open, you will need to look for an option called tools and click on it. Once the popup menu opens, you need to click on Reconcile and you will be ready to begin the process.

Step 2. Choose Account for Reconciliation.

Once you have opened the Reconciliation page, you will be able to start the Reconciling process. To begin, you will need to select the account you wish to reconcile. This will be selected from the dropdown menu given under the Account option.

Once you have selected the account you wish to use for how to reconcile in QuickBooks online, you can move on and click on Reconcile. In some cases, this option can appear as resume reconciling. This can be clicked to resume the reconciling process and then you can move further. If your account is not ready for reconciling or it has an issue, you will get an error message stating that your account is not ready for reconciling. When this happens, you would also see an option called We can help you fix it. Clicking on this button, will help you fix the problem.

These errors can occur if the entries in the transactions have been messed up. If you have edited or deleted entries from transactions that have already been reconciled the previous month, you will need to resolve it.

Some other mistakes that can commonly occur and mess up reconciliation in QuickBooks Online and result in the error message stated above are: if you change or alter the date of a certain transaction, if you delete a reconciled transaction or make it void, or if you change the account sourced for a reconciled transaction. You must avoid countinuing with these methiods as they will lead to errors.

In the case that you really need to alter or delete something, you will have to check about it with your bank’s business account department. They will help you to delete the transaction or even to edit it without it causing too many discrepancies. If you do this without talking to them, it can even unreconciled previous transaction.

For example, if you get the error message: Your account is not ready for reconciling, we can help you fix it. You can click on the blue hyperlink text that says We can help you fix it. Once you have done so, you will be given information about what exactly had gone wrong in the previous transactions that resulted in the error.

In the mentioned example, you can see report called the Reconciliation Discrepancy Report This report will be what the fixing system will lead you to. In this current example, the issue can be seen to have been caused by a force reconciling of a certain transactional expense. This can be seen by an R in the checkbox in the register. This should normally be avoided at all costs since it cannot reconcile the expense properly. Instead it would just cause a discrepancy that would ruin the account for future reconciling.

Lucky for you, you can change it to the C option in the checkbox indicating that everything has been fixed. This tells that the transaction has been cleared. Now you will need to navigate back to the reconciling tab. You can do this by using the methods given in step 1. Please keep in mind that you should not do this by pressing the back button on your browser as this can also cause some problems.

Now on the reconciliation page, you will see a summary. This will include a specialized list of the prior reconciliations of the previous month and a record of when each of them was completed. The option of “History by Account” will show you information which will seem similar to the summary. However, this will also include a tab about changes/auto-adjustments. This will also give you the ability to print out a report of the reconciliations that you have completed.

When you click on the option of “History by Account”, you will realize that this will contain especially lengthy information. If it seems too lengthy for you, you can click on the checkbox titled as “Hide Additional Information” Doing so will help you to see major data on the statement. This will help you to read and analyze the data more easily than before.

Step 3. Fill in Your Statement

Once you have returned to the reconciling page using the above processes, you can begin reconciling. This can start by clicking on the date and entering the banking cycle you wish to enter. These would be dates and need to be a month apart. It would be best to begin at the date right after the previous reconciliation. Once you have done this, you can click on reconcile to finish the process and your reconciling will be completed.