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H
HD63
October 4, 2020
Solved

Changing Deposits to General Journal Entries has messed up my Bank Balance for Reconciliation

  • October 4, 2020
  • 1 reply
  • 0 views

My wife and I started a new incorporated business in August 2018.  I do the bookkeeping with Quickbooks Pro Desktop.

 

In the first year, I made a rookie mistake and entered funds that we personally provided and the money loaned by the bank as simple deposits.  In June, as I was preparing the bookkeeping records for our accountant, I deleted these deposits and recorded them as General Journal Entries (Debiting our bank account and crediting either a Shareholder Loan or the Bank Loan).

 

Unfortunately, this has resulted in a significant Discrepency in the beginning balance for reconciliation of our business bank account.

 

Many thanks, in advance, for your guidance as to how I should handle the bank balance discrepancy!

Best answer by HD63

Sounds good. I'll be one message away in case you need anything else. 


Hi James,

 

Well I spoke with my accountant team and it turns out that the solution to my bank rec beginning balance discrepancy was an easy fix. 

 

I just had to run a second bank rec for the last month that I had previously completed. This enabled me to accept / check off all of the new transactions (the GJEs I had entered after deleting the deposits) and bring the balance back to the actual / correct value.

 

Thanks again for being available and guiding me to my accountant to solve the problem.

1 reply

J
JamesM
October 5, 2020

Hi there,

 

Reconciliation can be a time-consuming process but don't worry, QuickBooks is designed to bring simplicity to your work. I'll be happy to share more info about fixing a discrepancy on your beginning balance. 

 

The beginning balance can be affected by any of the following variables: 

  • No balance or an incorrect balance was entered when the account was set up.
  • Previously cleared and reconciled transactions were voided, deleted, or modified.
  • The file was converted from a different version of QuickBooks.
  • Possible data damage.

To fix beginning balance in QuickBooks Desktop, follow the steps outlined in this article here. I also encourage you to check out this insightful article with more about reconciling in QuickBooks.

 

Give this a try and if you need further assistance, don't hesitate to reach out to our support team using this link. Otherwise, feel free to reach out if you need anything. I got your back.

H
HD63Author
October 5, 2020

Hi JamesM,

 

Many thanks for your reply. The article that you provided is very helpful. It allowed me to understand why my Reconciliation Beginning Balance has changed.  I am hoping that you could provide specific advice as to how I should fix the problem.

 

In summary, for the first number of months I entered Deposits into my business general account which were not 'deposits' at all, but transfers of funds from my personal account and funds loaned by the bank.  Despite this, I reconciled my general account each month and all was good.

 

However, when I started preparing my data to give to my accountant for Financial Statements preparation, I went back and deleted these specific 'deposits' and created General Journal Entries instead, showing the tranfer of funds between Accounts.  Was I wrong to use GJE's for these transactions? Should I have used Transfer between Accounts instead? 

 

And this is the first time that I am trying to Reconcile my Bank Account since deleting the Deposits and adding the General Journal Entries; so I've now noticed that my (apparent) Bank Balance (at the end of the last reconciliation) is no longer accurate to what's actually in the Quickbooks account. It's been affected by the deletion of all of the deposits that I switched to GJE's.

 

So... how do I fix the discrpency? Do I remove the GJE's and replace them with Transfers between Accounts? Or do I make a "one time Quickbooks adjustment" as indicated in the article that you provided?

 

Thanks, in advance, for your guidance :)

 

J
JamesM
October 5, 2020

I'm glad you found the articles helpful. I want to make sure your transactions are recorded the best way possible. To ensure accuracy, I suggest reaching out to your accountant for expert advice on this. I'll also leave this question open to the community so other members can chime in and share they're perspectives. Depending on which method you choose, I'll be happy to show you how to accomplish that using the program. Let me know if you have questions.

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