Initial Bank Reconciliation

Background
Performing the Initial Bank Reconciliation

Background

The initial bank reconciliation process only has to happen if you have any uncleared transactions (withdrawls or deposits) that occured before the conversion date (first day you can enter transactions in) of your AccountEdge company file. If there are no transactions like this you can instead just enter your Opening Bank Balance and perform a standard reconciliation.

Performing an Initial Reconciliation

There are several steps to reconciling your bank account initially. You'll need your bank statement from the month immediately before your conversion date.

Step 1: Calculate your opening account balance

  1. Look at your bank statement and write down your closing account balance
  2. Add any uncleared deposits that are missing from your statement to this closing balance
  3. Subtract any uncleared withdrawls that are missing from your statement to this closing balance
  4. In AccountEdge go to Setup > Balances > Account Opening Balances from the menu bar at the top of the screen
  5. Enter in the balance of your bank account

Example
My bank statement shows that my closing balance as of October 31st is $10,000. My conversion date for AccountEdge is November 1st. Looking over my statement I notice that the check that I wrote to my brother for $1,500 hasn't cleared because it isn't included on my statement. I'm going to subtract the $1500 from the $10000 and enter my opening account balance as $8500.

opening_balance.png

Step 2: Record any uncleared withdrawls

  1. Go to the Banking Module
  2. Click Spend Money
  3. In the upper left (Pay from Account) select the bank account we are reconciling
  4. Enter in the check number (if there is one) in the check number field - you can also type a word like TRANSFER if it's not actually a check
  5. Enter the date as the first day of your conversion month
  6. Enter in the amount field the amount of the payment
  7. In the Acct # field below the check choose the same bank account as your allocation acccount
  8. Record the check

Continue to do this for any other uncleared withdrawls

Example
I'm going to record a check for $1,500 to my brother that uses the checking account for both the Pay from AccountEdge field and the allocation field.

spend_money.png

Step 3: Record any uncleared deposits

  1. Go to the Banking Module
  2. Click Receive Money
  3. In the upper left (Deposit to Account) select the bank account we are reconciling
  4. Enter the date as the first day of your conversion month
  5. Enter in the Amount Received field the amount of the payment
  6. In the Acct # field below the check choose the same bank account as your allocation account
  7. Record the deposit

Step 4: Reconcile the account

  1. Go the Banking Module
  2. Click on the Reconcile Accounts button
  3. In the upper left choose the account that you are reconciling
  4. In the new statement balance field (upper right) enter in the closing balance from your bank statement
  5. In the Bank Statement date field enter in the first day of your conversion month
  6. Check off ONLY the transaction that will allow you to reconcile (for checks you've written it will be the deposit and for deposits to you it will be withdrawl).
  7. Once you've checked off all applicable transactions (you'll be left with the outstanding pieces still in the reconcile window) you can click the reconcile button at the bottom of the window

This will allow you to reconcile your account for the first time. You're done for now. When you receive your next statement, you will have the necessary checks and deposits (these checks and deposits that hand't yet cleared) so that you can reconcile properly.

Example
I'm going to enter in $10,000 as my new statement balance. I'm going to check off the deposit piece of the $1,500 check to my brother and leave the other piece (the withdrawl) alone. I'm going to click reconcile at the bottom right corner of the window.

reconcile_accounts.png