Switching from one checking account to another

[yaura]

I am my church's brand new admin. We just recently switched banks from NW Credit Union to Coastal. We will no longer be using the checking accounts for NW. I guess my questions are as follows:

• What is the proper way to show that money was withdrawn from NW and moved to Coastal?
  • Are there any steps necessary to close or combine NW with Coastal or should I just leave it empty?

[NeilZ]

I am my church's brand new admin. We just recently switched banks from NW Credit Union to Coastal. We will no longer be using the checking accounts for NW. I guess my questions are as follows:

• What is the proper way to show that money was withdrawn from NW and moved to Coastal?
  • Are there any steps necessary to close or combine NW with Coastal or should I just leave it empty?

I'm going to assume that you added the new checking account as a new asset account.
Example: Old account was 1110-000, new account 1111-000.

If that's the case, you would create a transaction under Funds Accounting, debiting the old account, and crediting the new account. LIke this, assuming the account had a total of 1000.00

01-1110-000 CREDIT 1000.00
01-1111-000 DEBIT 1000.00

For a note you'd say: "transfer from previously used bank checking account to new bank's checking account", or similar.

Then you would do a final reconciliation on the old account using the last bank statement from that old bank, and the new deposit would be reconciled in the new account using the new bank's statement when it comes in.

You should NOT use the same account number for the new bank. It does mean making more work to adjust some transactions, but this way you won't have to worry about duplicate check numbers, and having issues with banking history. Once you've done the final reconciliation you can make the old account inactive using the "Maintain Chart of Accounts"