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      How Do I Reconcile Complex Transactions in Bank Reconciliation?

      While reviewing your Bank Reconciliation, you can use any of the useful troubleshooting steps below to ensure your Accounting Reports are up to date. If you’re looking to do simple reconciliation with Match and Mark As… check out the Reconciling Simple Transactions article instead.

       

      Accounting features like Bank Reconciliation are available on trials as well as Plus, Premium and Select plans. We also recommend inviting an Accountant to help you learn more about Bank Reconciliation.

       

       

      Balances Not Matching

      If your Bank Account Balance does not match your real-time Bank Account’s balance, then:

       

      If your FreshBooks Balance does not match your Bank Account Balance then:

      • Match or Mark As all the transactions on the left side of your Bank Rec until there are none left
      • Check for Journal Entries posted to the Bank Account - this will cause a difference as they will change the FreshBooks Balance but will not affect the Bank Account Balance

       

      Complex Transactions

      Check any of the below for how to best handle reconciling more complex transactions: 

       

      Bill Payment Reconciliation

      To reconcile a Bill Payment, you can either:

      • Mark an Expense as a Bill Payment through Bill Payment Reconciliation
      • Match a Bank Transaction on the left side of Bank Rec to a Bill Payment FreshBooks Entry in Bank Rec

       

      When the Bill Payment is reconciled, this can be found in the Matched section of Bank Rec and the Expense entry will be automatically deleted. You can find these in your deleted Expenses in the Expenses section.

       

      Invoice Payment Refunds

      For full or partial Invoice Payment refunds, if you're exporting your Reports each month to close your books, we recommend using Journal Entries to accommodate for this instead.

       

      Otherwise, use the below steps to reconcile partial or full Invoice Payment refunds:


      Full Invoice Refunds

      1. Find the original matched Invoice payment and unmatch it with the steps in Viewing Matched Transactions
      2. In the Unmatched section, using the steps in Reconciling Transactions, create a $0 payment to match with the two Bank Transactions
      3. Then match the Invoice payment from your Bank Transaction with the refund from your Bank Transaction, along with the new $0 payment created
      4. Delete the Expense detailing the refund, if one was created.
      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
      3. In the Unmatched section, you can now match the partial refund from your Bank Transaction to the original matched Invoice payment
      4. Delete the Expense detailing the refund, if one was created.
      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).

       

      Manual Journal Entries

      Journal Entries created manually posted to a Bank/Credit Card Account do not appear under the FreshBooks Entries column in Bank Rec. This can often apply to Journal Entries like:

      • Loans or Line of Credits
      • Long-Term Assets
      • Inventory
      • Tax Remittances


      To reconcile transactions that require a manual Journal Entry, use the below steps to mark these as Transfers:

      1. Select the transaction on the left under Bank Transactions
      2. Then click on Mark As button and select Transfer
      3. In the Notes field, leave details on the manual Journal Entry for your Accountant and click Submit to save
      4. Your invited Accountant can now create a Journal Entry to record the correct transaction for the Bank/Credit Card Account.

      This will move the transaction from Petty Cash to reflect in the Bank/Credit Card Account, and ensures the entry no longer appears on the left side of Bank Rec, allowing you to complete reconciling the account.

       

      Online Payment Deposits & Fees

      When using Online Payment options like Barclaycard, FreshBooks Payments (WePay), PayPal and Stripe, payments are often deposited into your bank account in batches. These deposits, along with your transaction fees, add up together to represent the total paid on your Invoices.

      In Bank Rec, match each deposit Bank Transaction with their corresponding Invoice payments and transaction Fee Expenses under FreshBooks Transactions together:

      Bank Transactions FreshBooks Transactions
      Transaction 1: +$240 Payment 1: +$250
        Expense 1: -$10

      In this case, the payment gateway's deposit in Bank Transaction ($240) equals the Invoice payment (+$250) and transaction fee Expense (- $10) under FreshBooks Transactions.


      To find out which Invoice payments are in your deposit, use the below steps to download a report from your payment gateway:

      WePay

      1. Log into your WePay account
      2. Click on Reporting
      3. Then select Settlements
      4. Choose the settlement you want the report for
      5. Click on the Download CSV button, and you’ll receive an email within 5 minutes with a link to download the report.

       

      Stripe

      1. Log into your Stripe dashboard
      2. Click on Balance
      3. Then click on Transactions
      4. Next, click on Export in the top left corner
      5. Choose the date range as needed and click Export.

       

      Note: If you’re using an online payment option that isn’t integrated directly to your FreshBooks account, you may have to manually record the transaction fees before the entries can be matched.

       

      Payroll Apps

      To reconcile Gusto entries, because matching many to many transactions in Bank Rec isn’t available yet, you will need to edit these imported transactions to match the amounts under FreshBooks Entries.
      Reconcile Gusto entries using the below steps:

      1. In your Bank Rec widget, take note of your Bank Account Balance - after completing all of the below steps, this should remain the same
      2. Next, find the Gusto transactions for one payroll period under Unreconciled Bank Transactions, add them up and ensure the total equals the Gusto transactions under FreshBooks Entries too
      3. Note the amounts for the Gusto FreshBooks Entries, then check off the boxes next to the Gusto transactions under Unreconciled Bank Transactions
      4. Click on the Bulk Actions button
      5. Select Edit
      6. Edit the Amount fields to match the FreshBooks Entries amounts you noted earlier
      7. Click Save Changes to finish
      8. Then Match the edited Gusto Unreconciled Bank Transaction Entries to the Gusto FreshBooks Entries.

       

      Missing Expenses

      If you have Expenses on the left side under Unreconciled Bank Transactions but there is no matching Expense on the right side under FreshBooks Entries, there are 3 possible reasons why:

      • The Expense has already been matched to another transaction. You can check in the Matched tab inside your Bank Rec to confirm this.

      • The Expense was not imported from this Bank Connection, and instead was imported and created by a different Bank Connection (including disconnected connections of the same Bank/Credit Card account). Only Expenses from the same Bank Connection will appear inside your Bank Rec widget.

      • The Expense has been deleted inside your Expenses section. Duplicate Expenses can occur if you’ve disconnected and reconnected the same Bank Connection, and the Expense from the disconnected Bank Connection may be in your active Expenses, while the newer Expense from the active Bank Connection is in your deleted Expenses. Deleting the active and restoring the deleted Expense can be done with the steps below.


      Restore Missing Expenses in Bank Rec

      Use these steps to restore missing Expenses in the correct Bank Rec widget for you to reconcile, especially if you’ve previously connected and disconnected the same Bank Connection before:

      1. First, check for all disconnected bank accounts, since Expenses created from the first connection will not appear in the new connection, regardless of whether it’s the same bank account
      2. If this is a reconnected account, go to the Expenses section and click on the deleted link at the bottom of the list of Expenses
      3. Find the duplicate Expense that belongs to the active Bank Connection by comparing the Source name
      4. Once you’ve found the duplicate Expense, click on it and click OK to undelete it
        Return to your list of active Expenses by clicking on All Expenses at the top of the list
      5. Next, find the duplicate Expense that belongs to the disconnected bank account and hover over it, then click on the trashcan icon to delete it.

       

      Once the active Expense is undeleted, and the duplicate Expense from the disconnected account is deleted, the Expense should now appear in the Bank Rec widget for you to reconcile.

      If you’re not sure which Expense belongs to which Bank Connection, or you need more help, please reach out to our Support by email.

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