If your QuickBooks Online register balance and your actual Bank balance don't match in QuickBooks Online, don't worry! There are several reasons that the balance in QuickBooks Online could vary from the bank balance.
1. Outstanding checks
The relationship between QuickBooks Online and your bank is a real-time picture. What this means is that your bank balance and the balance in QuickBooks Online will only match if you don't have any outstanding checks.
Think of the QuickBooks Online balance as the balance that would be in your checkbook register. When you write a check from your checkbook, you deduct it from your registered balance even though it hasn't actually cleared the bank yet. This process causes your registered balance to be different from your actual bank balance.
For example, if your bank balance is $1000 but you have an outstanding check for $100, QuickBooks Online will enter the check-in the register causing it to look as though it has already cleared the bank and will reduce your balance by $100, which means the balance in the register of QuickBooks Online will be $900. The bank balance, however, will continue to read $1000 until the outstanding check/cheque has cleared.
2. New transactions for a connected account
If QuickBooks Online is connected to your bank to download transactions, any transactions that are in the New Transactions tab and have not been added are not included in the balance on the register in QuickBooks Online but are reflected in the actual bank balance. As long as they remain in the New Transactions tab they will not affect your QuickBooks Online balance.
Adding them to the register will update the balance in QuickBooks Online, but this does not apply to transactions that have been entered on the register and need to be matched.
3. Duplicate transactions
Transactions may have been incorrectly added to the register instead of being matched to a current transaction already entered.
An easy way to check for duplicates is to customize your register and sort it by amount instead of date. This will place transactions of the same amount next to each other and make finding any possible duplicates much easier.
If you added a transaction but should have matched, you can undo the acceptance and then match the transaction instead. See Assigning, categorizing, editing, and adding your downloaded banking transactions.
4. Editing or deleting transactions
Editing or deleting transactions already in your register can cause discrepancies between the bank balance and the balance in QuickBooks Online.
5. Credit card and liability accounts
These types of accounts have the opposite accounting effect on your books than bank (or asset) accounts do. Because of this, the Bank Balance column for these accounts will normally be negative. What you want to look at is the Balance column and make sure that is correct (positive).
If the Balance column is negative, you need to recheck your record transactions and reconciliation to troubleshoot a credit card balance. If using downloaded transactions, have you added the payment from the bank account and then matched it from the credit card side (or vice versa), or did you use Transfer? If not, you may have added it from both the bank and the credit card or liability account, causing duplicate transactions. To fix it, undo one of the added transactions and then match it.
If you need advice or services on any aspect of bookkeeping, accounting, and tax, our specialists are ready to help. Get in touch with us for a free quote.
#quicbooks#balance #bankaccount#irvinebookkeeping#bookkeeping #accounting#CA#LA #irvine#california