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TD123
August 30, 2021
Question

How to record uncleared transfers end of fiscal year

  • August 30, 2021
  • 1 reply
  • 0 views

Hello,

 

We have couple of payout transactions from our online accounts at the end of the fiscal year that cleared into our checking only after the fiscal year. We use QBO accounts for both the online accounts as well as our checking accounts and we reconcile them regularly.

 

We used to record this payouts as transfers between the two accounts. However due to the delay clearing our balance sheet does not match the statements at the end of the fiscal year.

 

How can we properly record these in QBO? Some options came to mind, but not sure what's better:

1. Instead of recording as a transfer, we transfer it from online account to Accounts Receivable (A/R) first, and when cleared transfer from Accounts Receivable (A/R) to checking.

2. We use Undeposited funds

3. Any better idea?

 

Thanks

 

1 reply

PrachiJoshi
PrachiJoshi
August 30, 2021

You can leave the transfers as it is. It is ok if they stay in the bank GL and clear in the next fiscal year. Your year-end accountant will ask for the bank statement and the reconciliation report of the accounts. And will be able to see that these transfers were not cleared in the last fiscal year. Usually they also ask for the bank statement for the next month as well and will be able to see that these transfers cleared in the next period.

 

Thanks

Prachi

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