How to reconcile accounts in QuickBooks

How to Reconcile Your Accounts in QuickBooks Online

Reconciliation is vital to managing your books in QuickBooks Online (QBO). It ensures that the transactions in QBO match your bank statements and identifies errors like duplicate entries or missing transactions. Here's how to reconcile your accounts effectively, step by step.

Why Reconcile?

Reconciling ensures the integrity of your financial records by comparing:

• Transactions in your bank statement.
• Transactions recorded in QBO.

By reconciling regularly, you can:

• Catch errors, such as missing or duplicate transactions.
• Ensure your books are accurate before preparing taxes.

Step 1: Prepare for Reconciliation

1. Categorize and Review Transactions

   • Ensure all transactions for the previous month have been accepted and coded in QBO.
   • For example, in December, reconcile November’s transactions.

2. Obtain Your Bank Statement

   • Download or print a copy of your bank statement for the month you’re reconciling.

Step 2: Start the Reconciliation

1. Access the Reconciliation Tool

   • Click the Gear Icon in QBO and select Reconcile.

2. Select the Account

   • Choose the account you want to reconcile (e.g., checking, credit card, loan).

3. Enter the Statement Details

   • Input the statement’s beginning balance, ending balance, and statement end date.

4. Start Reconciling

   • Click Start Reconciling to begin the process.

Step 3: Match Transactions

1. Compare QBO to Your Statement

   • Check off transactions in QBO that match those on your bank statement.
   • Green checks in QBO indicate cleared transactions, while others need manual review.

2. Investigate Discrepancies

   • If something doesn’t match (e.g., missing or duplicate transactions), pause to investigate.
   • Avoid forcing a reconciliation if the difference isn’t resolved.

3. Achieve a $0 Difference

   • Your goal is a zero-dollar difference between QBO and your bank statement.

Step 4: Finalize and Save

1. Complete the Reconciliation

   • Once everything matches, click Finish Now.

2. Generate a Reconciliation Report

   • Save the report for your records.
   • The report includes:
     • Beginning and ending balances.
     • Cleared transactions.
     • Unclear transactions for further review.