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DS127
March 30, 2021
Question

Deposits from Square come to undeposited payments - how to change

  • March 30, 2021
  • 1 reply
  • 0 views

I've seen a few posts about this but none answer my question.  My client uses Square and QBO (but NOT the Sync w Square app).  I see the income they collect via Square coming in through the bank feed, and the transactions land in "Undeposited Funds".  I just noticed there are over 5000 transactions there!

 

We have dutifully reconciled so most of those are reconciled ("R") in Undep FUnds.  But $1000 is on the balance sheet in this Asset account.  Since they are keeping track of all the client payments in Square, I just need to have the bank transactions come directly into my QBO bank account rather than go here.

 

Am I right about that? if so, how do I get them moved and get this changed going forward? Or shouldn't I worry about it? It's the $1000 on the balance sheet that bothers me the most I guess.

Thanks!

1 reply

Rose-A
Rose-A
March 30, 2021

I'd be glad to help you change the default deposit account from Square, DS127.

 

You can manually change the Deposit to account in each payment to remove them from the Undeposited Funds. Here's how:

 

  1. On the left pane, select Accounting and choose Chart of Accounts. 
  2. Find Undeposited Funds. 
  3. Under the ACTION column, click the drop-down and select Run report. 
  4. Select the payment. 
  5. On the Receive Payment page, click the drop-down under Deposit to. 
  6. Select your bank account then click Save and close.  
  7. Do the same steps for all payments.

 

After that, let's change the default bank that is linked to the Square so that the transactions will not flow to the Undeposited Funds. See the steps below.

 

  1. Go to Banking and select the App Transactions tab.
  2. Click the App settings.
  3. Select the tab for the type of setting you want to change.
  4. Update the default Bank account where Square deposits your money.
  5. Hit Save changes.

 

Once done, you can refer to the following write-up to help guide you in reconciling your accounts in QuickBooks Online: Reconcile an account in QuickBooks Online. This will provide you steps on how to review your account as well as a link to resolve discrepancies.

 

Keep me posted with any follow-up questions about deposits from Square or need help with the reconciliation process. I'll be right here to provide additional assistance. Have a wonderful day!

D
DS127Author
March 30, 2021

Thanks for your message, Rose.But I think you missed 2 important details in my post.

 

One, I have over 5,000 transactions sitting in Undep Funds (put in there before my time). So correcting each one doesn't work for me. I AM open to doing this for the 2021 transactions. Also, in correcting them, since they go back to 2017, I can't change anything material bc of course those financials are already done, taxes finished.

 

Re: going forward, the other point you missed is that the client does NOT "sync with square". So I don't have an "App settings" tab. The bank feed just pulls these in.

 

It seems to me I need a Rule to say "Whenever Square Cash Payment" is in the Memo field, to post to A/R. THe transactions are not all consistent (see the Undep Funds report I am attaching..."Square Settlement"...is the client creating invoices in some cases..?)

 

Looking forward to receiving the input. Thanks!

LieraMarie_A
LieraMarie_A
March 30, 2021

Thank you for all of the details! Rest assured, I'll help you get these payments categorized with ease, @DS127.

 

Whenever you deposit your money from the Undeposited Funds to your bank account, it will automatically show as reconciled (R) in the asset register. I've included the steps below on how to locate the funds that are still sitting in this account.

 

  1. Go to the Gear icon and select Chart of Accounts.
  2. Find the Undeposited Funds account, then click View Register under the Action column.
  3. Click the Filter icon above the Date column.
  4. In the Reconcile Status drop-down, select Not Reconciled.
  5. Select All Dates from the Date drop-down list.
  6. Click Apply.

 

Doing this will list all the payments that sum up the account balance. Should you need to move them to your bank, these instructions will let you do so:

  1. Click the +New button.
  2. Choose Bank Deposit.
  3. From the Account dropdown, choose the account you want to put the money into.
  4. Select the checkbox for each transaction you want to combine. Make sure the total of the selected transactions matches your real bank deposit transaction. You can use your bank statement as a reference. 
  5. Select Save and close or Save and new.

 

Let me also share these articles about managing your payments:

 

You can also create bank rules as this helps automatically categorize transactions for you. 

 

Here's how:

  1. Go to the Banking or Transactions menu. 
  2. Select the Rules tab.
  3. Click New Rule.
  4. Enter a new rule name.
  5. Select Money in or Money out from the dropdown menu.
  6. From the In drop-down, select the bank or credit card account.
  7. Set the rule conditions. Decide the transaction must meet All or Any of the conditions. You can add up to 5 conditions.
  8. In the Conditions fields, specify whether the rule applies to Bank text, Description, or Amount. Then, select Contains, Doesn't contain, or Is exactly to decide when how QuickBooks applies the rules.
  9. Select the settings for the rule. Select the Transaction Type, Payee, and Category to apply.
  10. Click Save.

 

Feel free to read this article to learn more about bank rules: How to Set and Use Banking Rules for Downloaded Transactions.

 

Hope this clears up your confusion. If you have any other questions or clarifications, feel free to leave them in the comments below. I'll get back to you as soon as I can.

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