Reconciling bank accounts in QuickBooks Online is an essential accounting task that helps ensure your financial records match your actual bank statements. Regular bank reconciliation helps identify missing transactions, duplicate entries, incorrect amounts, and unauthorized charges. If your QuickBooks balance does not match your bank statement, reviewing and correcting the differences can help maintain accurate books.
In this guide, you will learn how to reconcile bank accounts in QuickBooks Online, resolve common discrepancies, and avoid mistakes during the reconciliation process.
Bank reconciliation is the process of comparing transactions recorded in QuickBooks Online with those listed on your bank or credit card statement. The goal is to confirm that deposits, withdrawals, fees, payments, and other transactions are recorded correctly.
When reconciliation is complete, the difference between the bank statement balance and the cleared transactions in QuickBooks should be $0.00.
Regular reconciliation helps you:
Maintain accurate financial records.
Identify duplicate or missing transactions.
Find bank fees and interest charges.
Detect unauthorized transactions.
Prepare reliable financial reports.
Simplify month-end and year-end accounting.
Before starting the reconciliation process, gather the following information:
Your bank or credit card statement.
The statement's ending date.
The ending balance shown on the statement.
Access to the correct bank account in QuickBooks Online.
Records of outstanding checks, deposits in transit, and other pending transactions.
Make sure you select the correct account and statement period. Using an incorrect ending balance or date can create reconciliation discrepancies.
Follow these steps to reconcile your bank account accurately.
Sign in to QuickBooks Online.
Open Settings (the gear icon) or navigate to the accounting tools available in your QuickBooks interface.
Select Reconcile.
Choose the bank or credit card account you want to reconcile.
If you cannot find the reconciliation option, check your access permissions and the menu layout for your QuickBooks Online subscription.
Enter the information from your bank statement:
Beginning balance: Confirm that it matches the previous reconciliation's ending balance.
Ending balance: Enter the ending balance shown on your current statement.
Ending date: Select the statement's closing date.
Review these details carefully before continuing. Incorrect statement information can make it difficult to reach a zero difference.
QuickBooks displays transactions associated with the selected account. Compare these entries with your bank statement.
Review each transaction for:
Transaction date.
Payment or deposit amount.
Payee or description.
Check number, if applicable.
Whether the transaction appears on the bank statement.
Select the transactions that appear on the statement. Do not mark transactions as cleared simply to force the reconciliation difference to zero.
If a transaction appears on your bank statement but not in QuickBooks Online, check the bank transactions page and your existing accounting records.
Possible reasons include:
The transaction has not been entered manually.
The bank feed has not imported the transaction.
The transaction was categorized incorrectly.
The transaction was recorded in another account.
The transaction was accidentally deleted.
Add or match the transaction as appropriate. Before creating a new entry, check whether it already exists in QuickBooks to avoid duplicates.
Duplicate transactions can make your books inaccurate and cause reconciliation differences.
Review transactions with similar dates, descriptions, and amounts. If you find a duplicate, determine which entry is correct before excluding, deleting, or correcting anything.
Also check for:
Incorrect payment amounts.
Deposits recorded twice.
Bank fees that were not entered.
Transactions assigned to the wrong account.
Checks or payments recorded with incorrect dates.
Always compare the entries with the original bank statement before making changes.
QuickBooks Online calculates the difference between the statement balance and the transactions you have selected.
Your goal is to reach a difference of $0.00.
If the difference is not zero, review the following:
Confirm the statement ending balance and date.
Verify the beginning balance.
Look for missing deposits or payments.
Check for duplicate transactions.
Review transaction amounts and dates.
Confirm that the correct bank account is selected.
Do not finish the reconciliation until you understand the remaining difference.
When the difference reaches $0.00, review your selected transactions one final time.
Select Finish now or the equivalent completion option shown in your QuickBooks Online interface. Save or print the reconciliation report if you need a record for bookkeeping or auditing.
Keep your bank statements and reconciliation reports organized by month so you can review past transactions when necessary.
Sometimes the reconciliation difference remains even after you review the transactions. Use these troubleshooting methods to identify the cause.
A beginning balance that does not match the previous statement's ending balance may indicate that a previously reconciled transaction was edited, deleted, or unreconciled.
Open the reconciliation history and review the previous period. Identify changes before adjusting any balances.
A transaction that was changed after reconciliation may affect the current beginning balance or create a discrepancy.
Review recently edited or deleted transactions, particularly those from previously reconciled periods. Correct the original transaction when possible instead of adding an unexplained adjustment.
Bank service fees, interest payments, and other small charges may appear on your statement but be missing from QuickBooks.
Record these transactions in the appropriate account and then return to the reconciliation screen.
If you use connected bank feeds, confirm that the transactions were downloaded and matched correctly.
Avoid adding a downloaded transaction when an existing QuickBooks entry already represents the same payment or deposit. Matching the entries helps prevent duplicate records.
Open the reconciliation report for the affected period. Compare it with the bank statement and look for transactions that were changed after reconciliation.
If you cannot identify the cause, consider asking a qualified QuickBooks accounting professional to review the transaction history before making adjustments.
Avoid these mistakes to keep your records accurate:
Reconciling the wrong bank account.
Entering the wrong statement ending balance.
Selecting transactions that have not cleared the bank.
Ignoring missing deposits or payments.
Recording bank feed transactions twice.
Deleting previously reconciled transactions without reviewing their impact.
Making an adjustment just to force the difference to zero.
Forgetting to save the reconciliation report.
A careful review each month can reduce the time required to find and correct discrepancies.
Most businesses should reconcile their bank accounts monthly after receiving their bank statements. Businesses with frequent transactions may benefit from reviewing downloaded transactions more often.
Monthly reconciliation helps you find errors while the transactions are still easy to investigate. It also keeps account balances current and improves the accuracy of financial statements.
Open the Reconcile page, select your bank account, enter the statement ending balance and date, and compare transactions with your bank statement. Select the matching transactions and finish when the difference reaches $0.00.
Common causes include an incorrect ending balance, missing transactions, duplicate entries, incorrect transaction amounts, or changes to previously reconciled transactions. Check your statement information and transaction history to identify the discrepancy.
A $0.00 difference means the selected transactions balance with the statement information entered for that reconciliation. Review the transaction details before completing the process.
Yes. You can reconcile an account manually by entering the statement information and comparing transactions recorded in QuickBooks Online with your bank statement. Automatic bank feeds are not required for manual reconciliation.
Review the previous reconciliation and look for transactions that were edited, deleted, or changed after reconciliation. Identify the underlying issue before making any adjustment to your books.
The available options depend on your user permissions and QuickBooks Online version. In some cases, an accountant user can undo a reconciliation. Before changing a completed reconciliation, save the report and review how the change could affect later periods.
Reconcile accounts regularly, verify statement dates and balances, match downloaded transactions carefully, avoid duplicate entries, and review reconciliation reports before completing each period.
Reconciling bank accounts in QuickBooks Online helps you maintain accurate financial records and identify discrepancies before they affect your reports. By entering the correct statement information, comparing every transaction, investigating missing or duplicate entries, and resolving differences carefully, you can complete the reconciliation process with greater confidence.
Make bank reconciliation part of your monthly bookkeeping routine. If the beginning balance or reconciliation difference remains incorrect after checking your records, investigate the original transactions before making adjustments.