XU Magazine - Issue 06

Fixing bank reconciliation ‘Out of Balance’ problems in Xero

BankRec-03
Written by Peter McCarroll

The bank reconciliation process in Xero, if provided with correct data and intelligent user interaction, should result in a perfect bank reconciliation where everything balances as expected. But the reality is that this does not always happen…

There are many causes for reconciliation errors which I will cover in another article. This article is specifically dealing with the scenario where your “Statement Balance” in Xero does not agree with your actual bank statement.

It is good practice to check your bank reconciliation at least once a month. This will identify any stale transactions and other data-entry errors that you need to fix (more on those in another article) as well as give you the opportunity to check that you Xero ledger balances with your bank statement.

Checking that your Xero bank account reconciles to your bank statement is the first step in a proper reconciliation – it verifies that you have all the data from the bank. If this is not done first it is much harder to solve other problems.

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About the author

Peter McCarroll

Peter was awarded Xero’s “Most Valuable Professional” award for his contribution to Xero’s online Community Forum. Peter is a Chartered Accountant in both New Zealand and Canada and provides Xero-based accounting and bookkeeping services to clients in New Zealand, USA and Canada as well as providing live support to Xero users around the globe. He is also the founder of uCollect.biz – a Xero add-on that helps initiate pre-authorised account collection. You’ll find him regularly answering questions in the Xero Community.