How to Reconcile in QuickBooks Desktop

 

For small businesses, the start of a new year brings with it a whole host of opportunities and challenges. Depending on the industry you work in, you may have had a busy run up to the holiday season. You’ve taken a few days to recover, and now you’re back in full swing.

New Year’s resolutions may have become a bit of a cliche. Regardless, though, the start of a new calendar year is an excellent opportunity to make new commitments related to your business. And for many small business owners, bookkeeping is one area where they frequently find themselves falling behind.

Out of all the accounting tasks that you’ll find yourself saddled with as a business owner, reconciling your accounts tends to end up pretty low on the priority list. Sending out invoices can be time-consuming (Biller Genie makes it easier), but the act of preparing and emailing invoices is directly connected with something very important to your business: getting paid. Meanwhile, reconciling can feel time-consuming, overwhelming, and downright confusing.

Here’s the truth, though: making sure your accounts are reconciled is essential if you want to have an accurate picture of your business’ finances.So if you’ve made a New Year’s commitment to keep better track of your business’ accounts, make sure that you add regular reconciliation to your to-do list.

In QuickBooks Desktop, reconciling might seem complicated at first. But trust us: it’s easier than you might think. Keep reading to find out how to reconcile in QuickBooks Desktop.

We understand and we’re here to help! As part of our QuickBooks Online tutorial series, we’ve put together a quick and easy guide to the software’s most essential features. Plus, we’ll show you how Biller Genie can expand upon QuickBooks’ existing functionality to help you get invoices paid faster -- and with less work on your end.

Ready to get started? Keep reading to learn more.

The Importance of Reconciling

Before we show you how to reconcile your accounts in QuickBooks Desktop, let’s take a moment to consider what reconciliation is and why it matters.

In order to reconcile an account in your accounting software (in this case, QuickBooks Desktop), you’ll go through all of the transactions listed for an account in QuickBooks and compare those transactions to the ones reported by the institution where the account is located (for example, your bank). One of the most common approaches involves using your online statement from your checking account(s), credit card(s), and other accounts as your frame of reference for comparison.

This process can be made significantly easier by using QuickBooks Desktop’s Bank Feeds feature. With Bank Feeds, you can connect QuickBooks directly to your financial institution in order to download transactions as they occur. This results in less manual entry on your part.

Of course, errors do still occur -- and that’s exactly why reconciling is so important. If you don’t reconcile your accounts, you can’t be sure of the exact balance of any of your accounts in QuickBooks. If you want to know for certain how much cash you have on hand, for example, recently reconciled accounts will give you the most accurate picture possible.

How to Create Your First Invoice 

Ready to reconcile your accounts? It just takes a few simple steps.

  1. Open up QuickBooks Desktop and locate the Banking menu. Select the Reconcile menu option.
  2. Click the Account drop-down menu and select the account you want to reconcile. Look at the bank statement you’re using to reconcile your account, and find the statement end date. Enter this end date into the appropriate field in QuickBooks.
  3. Once this is done, take a look at the balance displayed in the Beginning Balance field. This balance should match the opening balance of your statement. Now, click the Continue button.

On the next screen, go through the list of transactions in QuickBooks. For each item that appears identically on your statement, click the transaction in QuickBooks. If you’ve clicked every item and the Difference at the bottom of your screen is $0.00, you’re done! Just click Reconcile Now, and your account is officially reconciled.

If you end up with a difference between what’s displayed in QuickBooks and your statement, there are a few steps you can follow to resolve the discrepancy.

  • Make sure that the transaction was correctly entered in QuickBooks in the first place. If the item causing the discrepancy is a check, contact the vendor in question and make sure the check was received and deposited.
  • If there’s an erroneous transaction in QuickBooks that’s causing the problem, you can right-click on it and select Void in order to void the transaction.
  • Finally, if there’s a deposit that seems to be the source of the error, make sure that this deposit isn’t a duplicate (or that it’s not included as part of another, larger deposit).

When you reconcile your accounts, you get a clear, definitive picture of where your business stands in terms of cash flow. More often that many business owners would like to admit, they find that they have a stack of unpaid invoices in the queue. Meanwhile, expenses continue to pile up as they always do. It’s enough to make you dread the process of reconciliation.

Fortunately, though, getting paid doesn’t have to be a hassle. Biller Genie makes it easier than ever to ensure that your invoices are paid on time, without you spending countless hours sending payment reminders or following up with customers.

With Biller Genie’s automated email invoice reminders, your customers will receive an email according to the parameters you choose to remind them of an upcoming payment due date. Plus, Biller Genie makes it easy to add late fees to your invoices and send automated past due invoice notifications. The result? You’ll get paid faster, and you’ll spend less time worrying about cash flow.

Best of all, Biller Genie is free to use! Click here to sign up for your free Biller Genie account now.



 
 

Tags: improve cash flow, invoicing, paid faster, Payment Technology, QuickBooks Desktop, accounting, Biller Genie, Small Business, late payments, QuickBooks Intuit App, automatic reminders, email reminders, reconciling, reconcile invoices