What is your process for reconciling your cash GL account? Our accounting team thought the bank balance off of the Bank Statement Processing Edit List should tie out to the GL account balance for the same day. I don’t believe this is true because there will always be uncleared checks and other postings to the GL that don’t show up in the bank yet.
How do you reconcile it?
Aren’t Edit Lists just a detail of the GL trans that posting the “group” would create?
AR invoicing Edit list doesn’t “tie out” to the GL accounts that the invoices hit for sales. It does show which accounts are affected and by how much. But not what the balance in any of them are.
Does the Bank Statement Processing Edit List give you an ending balance for the accounts affected?
Yes, you’re right. The bank statement processing edit list isn’t the same though. When you “post” the bank statement, nothing posts to the GL. You are just matching up transactions that have been previously posted (cash receipts, payments, bank transfers, etc.) to what has cleared in your bank account.
The edit list summarizes the transactions that you cleared, and gives you this:
Does the “Reconciled Closing Balance” (top line of the edit list) match the opening balance on the Bank Statement?
(is it even supposed to?)
That line matches the closing balance in the bank. And then that balance turns into the opening balance for the next day. We reconcile daily.
Our bank reconciliation is great, and everything matches. The problem I am having is figuring out how to reconcile the cash GL account. Ideally that’s a reflection of your actual cash because it takes into account all of the uncleared checks. But how to reconcile that number is the question!
I meant to ask if the “Reconciled Closing Balance” ever matches the Cash balance.
Oh! No it does not. That is because there are uncleared checks that affect the cash balance but haven’t hit the bank yet.
I’m starting to get the feeling that the cash balance should be easily comparable to the bank statement numbers, and we may have some journal entries that are causing the issue.
I’d have thought that there’d be a holding account for uncleared checks. And that the cash balance wouldn’t reflect the checks until they are cleared.
If making a payment immediately is reflected in the Cash Balance, then the bank statements may never match.
Unless the thinking is that CashBalance + UnClearedPayemnts is what should equal the reconciled balance.
Can you whip up a BAQ to test that? Maybe a report based on that would appease the accountants. 
Also … Any chance this funstion is being used inconsistently?
Is this something that is only recently not matching? Or has it never matched (yet everything else seems copacetic) , and someone is just now asking why?
Historically, our accountants were their own worse enemy. They would see something that didn’t jive and do a Journal Entry, only for the system to do its thing (which would have made it jive), and not it really is out of whack.
They used to try and tie the Stock Status report to the Inv GL account, and would do corrections to the GL Acct when it didn’t match. For example, a PO receipt would happen with an incorrect cost, So Accounting would do a JE. Then materials would make the correction and now the GL is off by the amount of accounting’s “fixed”.
I tried to tell them they they should never do JE’s to GL accounts driven by the system (like Inventory). But they think they know better…
No, we are not using the pending account functionality. Though I like the idea of it now that i know it exists!
Agree with your logic here! That bank edit list actually shows all of those numbers, but we can’t get them to add up to the cash balance.
Yes, I think this has got to be the problem. I am not an accountant, but theoretically there should be no manual entries to this account.
I think it has been an ongoing problem just now realized. We do an audit every January, and they are asking for backup on our cash number… So that’s why I’m investigating
Thank you for your help. I appreciate all of the ideas! I think I’m onto something with this journal entry idea, and trying to confirm my suspicion now…
