Frequently Asked Questions

Bank Reconciliation is the process of matching transactions from your bank statement to entries in FreshBooks. This allows you to ensure your books accurately represent your bank accounts and that your funds are all accounted for. 

Bank reconciliation should be completed at regular intervals for all your bank accounts, to ensure your business’ records are correct. 

Note: Accounting features like Bank Reconciliation are available on trials as well as Plus and Premium plans. We also recommend inviting an accountant (if you haven’t already) to help you learn more about Bank Reconciliation.

Bank Reconciliation is also in beta for now, so only certain workflows are supported while we’re making changes. Please let us know how we can make this better by reaching out to us at accounting_feedback@freshbooks.com.

 

• Setting Up Your Bank Account
• Set an Opening Balance
• Reconciling Transactions
• Viewing Matched Transactions
• FAQs
  

To begin the bank reconciliation workflow, start with Setting Up Your Bank Account first, then Set An Opening Balance, before you start on Reconciling Transactions.

Setting Up Your Bank Account

1. Click on the Accounting section
2. Click on the Connect My Bank inside the Bank Reconciliation widget (if you’ve already connected any bank accounts previously, they’ll appear here)
   1. If you see your bank in the top 12 popular banks, click on it
   2. Otherwise, if you don’t see your bank, click on the Find your bank link below the top 12
      
   3. Then search for your bank using the name of the bank (at least 3 letters long), or the bank’s website link
   4. If the name of the bank and the bank’s website link matches what you normally log into online, click on the link
3. If your bank is not listed or available, please submit a request to have your bank added here
4. Once you’ve selected your bank, enter in your bank’s login credentials and press Submit
5. Answer any security/verification questions until all have been answered correctly and press Next
6. Wait for all your accounts to finish loading (all spinning icons disappear)
7. Once all accounts have finished loading, you can remove any unwanted accounts as well as rename any accounts (to help remember which account is which) using the Remove or rename account links
8. When you’re done, click on Import
9. A pop-up will ask you to how far back to import Expenses from - choose between Today, 7 Days ago, 30 Days ago, 90 Days ago, or custom (up to 90 days maximum)
10. Click Done
11. Once connected, click Okay, Got It
12. You’ll see a pop-up letting you know when you have expenses to start matching
13. If you want to connect other accounts, repeat steps 1-2 above with the Connect Another Bank Account button instead.

If you’re experiencing issues connecting your bank account, check out our troubleshooting article here.

 

Set an Opening Balance

Once you have a bank account (or several) connected, you’re ready to set the opening balance which will determine the amount you’ll start reconciling with moving forward.

1. Click on the Accounting section
2. You’ll now see your bank account(s) listed in the Bank Reconciliation widget, click on the Set your opening balance link
3. In the field provided, enter a date to start reconciling from (we recommend the first day of a recent bank statement or the start of a period on your credit card statement)
4. Click Continue
5. Enter your Opening Balance from the day you chose to start reconciling in the field
   1. If you’re setting up a credit card account, this is your Previous Statement Balance (if you’ve paid off your credit card balance, this would be $0)
6. Choose the Currency of your bank account you’re reconciling
7. Then click Continue again
8. You’re now ready to start reconciling this account. Click Get Started to begin.
   
   

Reconciling Transactions 

Once a bank account is set up with an opening balance, you can start matching transactions, which is the reconciliation process.

To get started, begin with the below steps:

1. Click on the Accounting section
2. You’ll now see your bank account(s) listed in the Bank Reconciliation widget, click on the x left to match link
3. FreshBooks will automatically match transactions for you
   1. If you see matches that are actually bank transfers or incorrectly matched, click on the checkmark to deselect it
   2. If you see matches that are correctly matched and there is nothing to change, keep it checked off
4. Click Confirm and Continue to proceed.

Any remaining unmatched transactions will need to be matched by you next. Depending on what kind of transaction you need to match, choose from the below options and follow the specified steps:

 

Match an Entry

If you see the corresponding entry (or multiple entries) in the FreshBooks Entries section, use these steps:

1. In the Bank Account Transactions section on the left, check off a transaction
2. Then in the FreshBooks Entries section on the right, check off one or several entries that match
3. Click on the Match button.

 

Change the Date Range

This is useful if the ones you’re looking for are not listed because they fall outside of the date range.

1. Click on the calendar icon next to FreshBooks Entries
2. Choose a new Start and End date
3. Click Apply to save and new entries should appear on the right
4. In the Bank Account Transactions section on the left, check off a transaction
5. Then in the FreshBooks Entries section on the right, check off one or several entries that match
6. Click on the Match button.

 

Create a New Entry

If the FreshBooks entry doesn’t exist yet, you can create it with these steps:

1. Under FreshBooks Entries, click on the Create a New Entry link
2. Then choose from Expense, Other Income, or Payment depending on what kind of matching entry you need to create
3. Once saved, this entry will now appear in the list of FreshBooks Entries
4. Check off the entry or entries that you’ve just created
5. Click on the Match button.

 

Mark as Bank Transfer

If the transaction is a transfer to pay off a balance in another account (e.g., credit card debt), you can mark it as a bank transfer without needing to match it to a FreshBooks Entry:

1. On the Bank Account Transaction itself, click on the down arrow
   
2. Then click on Mark as Bank Transfer
3. Enter a Description to indicate the reason for the transfer (like credit card payment)
4. Click Save and the Bank Account Transaction will no longer appear as an option to match.

New transactions will be imported in daily from your bank account(s), so you can continue matching up transactions on your own schedule, whether that’s daily, weekly, monthly or at a different frequency.

Viewing Matched Transactions

All matched transactions can be viewed with the below steps:

1. Click on the Accounting section
2. Click on the x left to match link for the account you want to review in the Bank Reconciliation Widget
3. Click on the Matched sub-tab.

If you’ve accidentally matched the wrong transactions together, you can unmatch them by checking off the box(es) next to the match(es), and clicking on the Unmatch Transactions button above the list.

The transactions from this match will then appear in the Unmatched sub-tab for you to reconcile correctly.

FAQs  

I received a partial reimbursement/return on an Expense. How do I match this?

1. Edit the original Expense down to the new total after reimbursement
2. Find the original matched expense and unmatch it with the steps in Viewing Matched Transactions above
3. In the Unmatched section, you can now match the reimbursement from your Bank Transaction to the original matched expense.

Bank Transactions	FreshBooks Transactions
Transaction 1: -$500	Expense 1: -$250
Transaction 2: +$250

In this case, both the original Bank Transaction (originally - $500) and the new reimbursement Bank Transaction (+ $250) will now match up with the FreshBooks Transaction of (- $250).

 

I refunded an Invoice payment partially/in full. How do I match this?

Full Invoice Refunds

1. Find the original matched Invoice payment and unmatch it with the steps in Viewing Matched Transactions above
2. In the Unmatched section, match the Invoice payment from your Bank Transaction with the refund from your Bank Transaction
3. Then using the steps in Reconciling Transactions, create a $0 payment to match with the two Bank Transactions.

Bank Transactions	FreshBooks Transactions
Transaction 1: +$800	Payment 1: +$0
Transaction 2: -$800

In this case, both the original Bank Transaction (originally + $800) and the refund Bank Transaction (- $800) will now match up with the FreshBooks Transaction of ($0).

Partial Invoice Refunds

1. Edit the payment on the Invoice to reflect the partial refund.
2. Find the original matched Invoice payment and unmatch it with the steps in Viewing Matched Transactions above
3. In the Unmatched section, you can now match the partial refund from your Bank Transaction to the original matched Invoice payment.

Bank Transactions	FreshBooks Transactions
Transaction 1: +$800	Payment 1: +$500
Transaction 2: -$300

In this case, both the original Bank Transaction (originally + $800) and the partial refund Bank Transaction (- $300) will now match up with the FreshBooks Transaction of ($500). 

 

I use WePay and/or Stripe and receive payments via deposits in my bank account. How do I match them with the payments and transaction fees?

All deposits you receive will not include transaction fees. Therefore, you can match each deposit Bank Transaction with the Invoice payments and transaction fee Expenses under FreshBooks Transactions together.

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