Reconcile Your Bank Account

Introduction

Reconciling your bank accounts is like balancing your checkbook. It is an important monthly accounting activity, and is especially important to understand for your Trust Accounts. CosmoLex offers Manual and Automatic methods to help you reconcile your bank account. Choose the method that best fits your needs and follow the instructions in this article. To view a more in-depth look at the reconciliation process, watch the video below. 

Watch a Video


Manual Bank Reconciliation

Step 1: Create a Statement

Important

Before beginning this step, please make sure that you have printed your checks for the bank account you wish to reconcile. Not sure how to print checks? Learn more here.

In order to begin reconciling your bank account, you will need to open a new reconciliation statement. To begin, follow the directions below:

1. Go to Accounting Tab > Bank tab.

2. Choose the bank you wish to reconcile, then click  Details at the top, or double-click on the bank

3. From the bank’s details screen, select the ‘Reconciliation‘ Tab.

4. To add a new statement, click Add at the top 

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5. Complete the new ‘Add New Bank Statement’ screen with ‘Bank Statement End Date’ and ‘Bank Ending Balance.’ You may retrieve your Bank Ending Balance for that date range from your online or paper bank statement or account information. Note that if you are reconciling your Credit Card account, please enter a negative balance in the Bank Ending Balance field. The software will allow you to do this for a Credit Card account.

The “Mark Bank Imported Transaction as Clear…” checkbox is used for automation when using the Bank Feed.

6. When you are finished adding your bank information, click Save

Step 2: Reconcile Your Statement

Important

Once reconciled, you cannot edit or delete transactions from that month.

Once a statement has been created, next you must reconcile the transactions in your books (CosmoLex) against your bank transactions. To complete this step, follow the instructions below:

1. Select the statement and click  Details, or double-click the statement. Here, you will see a list of all deposits and payments for that month. By default, you will see the Uncleared Deposits and Payments. 

2. Compare the transactions you see on the screen with any transactions that appear as cleared on your bank statement for both deposits and payments, and click the checkbox next to the transaction to clear it. Once a transaction is cleared, it will move to the cleared section. 

3. To filter through your transactions by status (cleared, uncleared, all transactions) or other parameters, use the advanced search on the right. 

 

4. As you clear/unclear transactions, your summary on the right will update with cleared/uncleared totals. Once your difference equals 0.00, you can click Reconcile to close that month. In addition, there is an option above the summary to clear or unclear deposits/payments all at once. 

Tip

If you wish to save your selections, but not reconcile just yet, click the Reconciliation button and come back another time to complete. 
 


Automatic Bank Reconciliation

CosmoLex recommends that users reconcile all bank accounts (operating, trust, and/or credit card) on a monthly basis for proper bookkeeping. Reconciling helps users catch their bank’s mistakes as well as their own. To make the process easier, CosmoLex provides Automatic Bank Reconciliation.

Step 1: Create Statement

Important

Before beginning this step, please make sure that you have printed your checks for the bank account you wish to reconcile. Not sure how to print checks? Learn more here.

In order to begin reconciling your bank account, you will need to open a new reconciliation statement. To begin, follow the directions below:

1. Go to Accounting Tab > Bank tab.

2. Choose the bank you wish to reconcile, then click  Details at the top, or double-click on the bank

3. From the bank’s details screen, select the ‘Reconciliation‘ Tab.

4. To add a new statement, click Add at the top 

image5

5. Complete the new ‘Add New Bank Statement’ screen with ‘Bank Statement End Date’ and ‘Bank Ending Balance.’ You may retrieve your Bank Ending Balance for that date range from your online or paper bank statement or account information. 

The “Mark Bank Imported Transaction as Clear…” checkbox is used for automation when using the Bank Feed.

6. When you are finished adding your bank information, click Save

Step 2: Import Transactions to Statement

Before Getting Started

To import transactions, you must first obtain them from your bank account statements or from any previous location you have stored them. To get your previous transaction records, there are two options:

  • From your previous accounting program –  If your previous program allows a transaction export to Excel or CSV you can export a transaction list
  • From your online bank records – This file will need to be in either CSV or QBO format. QBO format statements are the recommended option and are provided by most financial institutions.
Why QBO Format

Currently, we only support file type QBO. Almost all banks offer that. Otherwise, you can use 3rd party utilities or work with our consultants to convert your statement into QBO format. Apart from that, we can not offer any assistance in getting the statement from your bank. You must work directly with your bank.

  1. Log into your banks website
  2. Locate where statements can be downloaded
  3. Ensure to choose starting and ending dates correct when downloading bank statement file
  4. Download QBO format

If you have a .ofx format, you can rename that file to have the .qbo extension to import.

QBO Format for AMEX

Here are the steps to get QBO from AMEX (it is a slightly different process)

  1. Log in amex website
  2. Click on Statements & Activities
  3. On the right Click the green Download arrow
  4. From the dropdown menu select Card Activity (Very Important that you only select this item)
  5. You will see a screen. From left select Quickbooks, followed by Download at the bottom of the screen

Import Transactions

After creating your statement, you will need to import your transactions your list of transactions. To do this, follow the instructions below:

1. Click to highlight the statement and click Details, or double-click the new statement

2. On the reconciliation details screen, click Import Transactions

3. Click “Choose File”. This will allow you to browse your computer and select the QBO file you wish to import.

4. Click “Upload” when ready. The “Import Statements” screen will appear with the list of transactions from the QBO file. 

After uploading the statement, there are now 2 tabs:

  • Book – This tab is for transactions already entered into CosmoLex (your current books).
  • Bank – This tab is for transactions from the bank statement. This is only a reference to be used during the reconciliation process and these transactions will not actually get imported into your transactions list unless you choose to add them.

Step 3: Reconcile Your Statement

Now that you have your transactions in the system, you’ll want to reconcile those transactions with those in CosmoLex on your Reconciliation Statement. To do so, follow these instructions:

1. Clear any transactions that have been automatically matched first. Inside your reconciliation statement, in the bank tab, you may see a green “Clear” button next to some transactions. These transactions have been automatically matched to transactions previously entered into CosmoLex and are assumed to be cleared.

CosmoLex Rules for Auto-Clearing Transactions

Deposits – identical dates & amounts

Checks – identical check numbers & amounts

  • Click “Clear” in the Status column to individually confirm the matched transaction(s) or, to confirm the cleared transactions in bulk click “Clear All” above the reconciliation summary. This will clear all the transactions with the green clear icon.

  • If you want to clear select transactions at once, click on the checkbox next to the desired transactions and click the  Clear button directly at the top of the list. A confirmation will come up. Click Yes and those transactions will be marked as Clear.

2. If, before clearing a transaction, you wish to see details on what it has been matched to, click on the  Details icon on the right of the transaction. This will bring you to the “Match Details” screen, which shows you the transaction that it’s linked to. Here, you can verify the transaction. If it’s not verified, un-check the transaction, and it will remain as uncleared.

3. Delete any transactions that you do no want to import. Click the checkbox next to the requested transactions and click  Delete to remove them from the list.

4. After clearing the requested transactions, in the summary, you may still have a difference other than 0. At this point, you can switch between the Bank and Book tabs to compare the difference. If you need to make any additions or changes to any transactions, click the  Reconciliation button, which will save the work that you’ve done so far. Any cleared or uncleared transactions will remain the same.
 

5. Once all the changes have been made, and the difference is 0, you are ready to reconcile. In the Book tab, click Reconcile to complete the reconciliation. 

 
Tip

For a more in-depth look at reconciliation, watch the video above. And for related topics, please see related articles below.

Reconciliation Reports

Updated on July 15, 2019

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