Connecting your bank and credit card accounts to QuickBooks Online is a great way to track your income and spending without having to manually enter every transaction. Only recording your income through sales forms while leaving out your expenses provides an incomplete perspective of your business’ overall health, but creating records for every transaction can be a huge task.
If you connect your online bank accounts in QuickBooks Online, the program will automatically download the last 90 days of transactions recorded by your bank. The program will match existing entries already in QuickBooks online and add new records for incoming transactions without a matching entry. This feature ensures your accounts are always up-to-date and drastically reduces the amount of data-entry you need to do on a daily basis.
Connecting your bank accounts to QuickBooks Online and automatically importing transactions recorded by your bank saves a lot of time. Adding invoices and sales receipts takes effort - as your business scales, these tasks will increase accordingly. Using the Online Banking feature to supplement your efforts ensures all of your income and expenses get into QuickBooks so you have comprehensive financial reports and thus a comprehensive perspective of your business’ performance.
This automation also prevents data entry errors that occasionally occur with manual data entry, giving you peace of mind and freeing your day to get more done.
You can connect and manage multiple bank accounts (including credit cards and PayPal) from the Banking Tab.
This is what your typical Bank Feed will look like: your various accounts are separated in the header and historical transactions are listed below.
You can filter for each account (and see their totals) by clicking on the blue boxes in the header.
At the top of the columns above the transactions, you will see “All” and “Recognized.” Clicking “All” will display all the transactions for the selected account while “Recognized” filters for transactions that have a match (more on that in a minute).
Finally, at the very top are “Bank Rules” and the Update button, the latter of which you can use to manually update your Bank Feed with new transactions from the bank.
QuickBooks will download all of your bank transactions from the last 90 days into the Bank Feed. However, these transactions aren’t in QuickBooks just yet. Once they’re in the Bank Feed, you’ll still need to categorize these imported transactions so they're recorded to the correct accounts.
|Important – if you know a transaction already exists in QuickBooks (income, expenses, or otherwise), it’s very important that you use the match feature. Don’t "add" a new transaction from the Bank Feed without a match – this could result in double-counting your income or expenses since you’re essentially generating a duplicate transaction.|
The Online Banking feature also semi-automates record creation. For imported transactions that do not have a match, QuickBooks will generate a new record and attempt to categorize the transaction into the correct account.
Important – We want to emphasize again: go into the Sales or Expense tabs and fill out the rest of the information for the transaction right after you add it to the register. Bank records can only provide so much information to QuickBooks. You need accurate details for every record of income and expenses.
As you can see from the example above, in my haste I added this expense without entering any details -- and the record is missing a lot of information. If I walked away from my computer and came back the next day, I may completely forget about adding the details. Even if I do remember to finish the job, I will probably forget the details.
If you know the transaction is in QuickBooks, always look for the match. If for some reason QuickBooks can’t find a match for an invoice or expense you know for certain you’ve entered…
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