Bank Reconciliation - Differences

[Danna Hightower]

I have a $75.00 outage on my May bank statement that I think is related to our payroll company due to entries made on their end to pay a phone stipend back payment.

I need to carry this amount for a month, as I think they are going to find the difference this month, and I will need it to reconcile the June statement.

How do I carry an out of balance amount? Do I need to make a general ledger entry to a line item that I need to set up specifically for the purpose of "force balancing" or does PowerChurch do this for me? If it does, where does it post the out of balance amount?

I have not had this happen and did not want to proceed with showing this statement as "DONE" until I knew for sure!

Thank you!

[JohnDMeyers]

I am guessing that the $75.00 actually shows up on your bank statement.

Also, I am guessing that when you say "I need to carry amount for a month" means that wouldn't ordinarily pay this amount to your payroll company until you are ready to do so.

Well, it appears they have already taken it out of your checking account.

You might as well enter it.

DB payroll stipend fee
CR checking account

Then, post the transaction, go into your reconciliation window, and check it off.

Let me know if my assumptions are incorrect.

[Danna Hightower]

Actually, I think it's the other way around. We owe the money to them, and they did not debit us for enough. I have contacted them, but they do not seem to think there is an error. So, I thought I would "suspense" it for a month and see what happens. All my other entries are reconciled except this one, so I know it's for this entry.

It does not show up on my bank statement as an individual entry. There is a difference between what the payroll company should have charged me, and what was actually charged, and so I am carrying it out of balance.

If I were to set up a line item for bank reconciliation differences, where would I put it? As a liability?

[JohnDMeyers]

Is your reconciliation balance zero? It's not clear to me what you are saying.

Or are you concerned because it shows up in your reconciliation window without a "Y" next to your entry?

If your reconciliation is not zero, then make a liability entry and reconcile it, so that your reconciliation is zero.

If you are at zero with the reconciliation, but have one unreconciled item in the window, then you're fine, click DONE.

[Danna Hightower]

My reconcilation is out of balance.

So, I guess the answer is that I would never want to click "done" on an out of balance bank statement reconciliation. I need to setup a line item as a "suspense" account for outages and force balance my statment to zero, before clicking "Done". I did not know if Powerchurch automatically suspensed any differences to "someplace" in order to force reconcile an out of balance statement. It sounds like it does not do this, so an account needs to be established for any differences that are not immediately cleared.

[JohnDMeyers]

Yes. You have to set up a transaction that has one part that touches the checking account.

You could do it like this:
DB checking
CR owe your payroll company

It would be a debit, because you showed that you already paid them, but they didn't take that amount out of checking.

[Al]

I think you logic is correct Pam. You should postpone the reconciliation until your next month's statement arrives. That way, you can do two month's info at one time.

HOWEVER, if that doesn't reconcile you've got some digging to do.

Al