How to enter a beginning balance for first reconciliation

kshinson · ‎June 03, 2020

We started using QB in 2004. We do not use QB for invoicing and the way we were entering our daily sales work at the time prohibited us from using the reconcile feature in QB. The bank account was reconciled monthly outside of QB. Times have changed and we now want to use that feature starting with the December 2019 statement. Late yesterday, I copied the company file as not to disturb the original file to "test" reconcile. I followed the instructions in the article "Fix beginning balance issues in Quickbooks Desktop" I made a journal entry dated December 1, 2019 in the amount of the ending balance on the November statement as a debit to the bank and credit to Opening Balance Equity. Then I did a mini reconciliation dated December 1, 2019 and "cleared" the journal entry, the amount shown for the difference was zero and I "reconciled" in QB. Then I proceeded to actually reconcile December. The correct beginning balance was there and I entered the ending balance. I hid the transactions after the statement date. Selected "mark all" this was taking quite a bit of time because of the volume of data in the file so I left it for the night, This morning every transaction was checked and and then unchecked all of the uncleared checks, debits, deposits and credits. I anticipated that there would be a "difference" that I would adjust with a journal entry. To my shock the difference is HUGE almost equivalent to the actual bank balance! Have I followed the process correctly???

Angelyn_T · ‎June 03, 2020

I appreciate the detailed information and thank you for reaching out to us here on the Community page, @kshinson.

The process you've followed was correct. If the period you're reconciling is for December 01, 2019 to December 31, 2019, then make sure that only those transactions within these dates are selected under the Reconcile page to avoid any difference or issues. There may be some transactions that were selected outside the period of reconciliation that affect the huge difference.

For more information about reconciling accounts in QuickBooks Desktop, check out these articles:

Post again if you have any other QuickBooks or banking questions. I'm a few clicks away to help. Have a great day!

kshinson · ‎June 08, 2020

I tried the suggested method of just selecting the transactions within the statement period ... Was not pleased with the outcome. We started using QB on 2004 so there was an incredible number of uncleared transactions prior to the statement period it made the detail reconciliation reports hundreds of pages long and confusing because it was listing transactions as uncleared that had actually cleared the bank. I knew that going forward the reports would always be troublesome and confusing for our employee that is responsible for reconciling the account. After much thought I undid the previous reconciliation, removed the journal entry that I had created for the beginning statement balance for December, left the balance as $0.00 and used the ending balance on the December 2019 statement for the first reconciliation. I hid all of the transactions prior to the December statement end date. I selected the "mark all" tab and then unchecked all of the transactions I knew to be uncleared as of December 31. I was very pleased with the outcome, the difference was only $567.40. I made a $567.40 journal entry debiting the bank and crediting misc expense which brought the difference to $0.00. Now we are starting with a clean slate for 2019 year end!

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How to enter a beginning balance for first reconciliation

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How to enter a beginning balance for first reconciliation

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