Bank Reconcilation for the first time.

Question

Hi,
I need help on how to do a bank reconciliation for the first time.  The bank statement has some transactions which happened on the old system now when we tried to reconcile the total does not match to the bank statement. How can we get it to reconcile we cannot make once sided entry.
Thank you

Answer 1

Hi Ghanbary, if we think logicially, the bank statement has transactions that occurred before you cut over to B1. So the question is do those transactions belong to Customers and Vendors such as receivable or payables, or were they expense and revenue deposits or owners withdrawing and depositing funds etc?
An Example : If the transactions are A/R and A/P related, you do not have actual transactions in B1?
Obviously you have following possibilities:
1. Import open transactions using DTW? Perhaps not a good idea that should have been done earlier.
2. Question is did you transfer your customer/vendor opening balances? If so, you can match above bank external reconciliation with respective BP. You can use ProcessExternalBanking function in Banking module against BP.
3. Above matching of external bank account can also be done against G/L account, provided you transferred opening balances of G/L accounts such as Receivable/Payable
In general you can balance external bank credit/debit with G/L debit/Credit but you have to know logically what is the transaction from Bank, do we have an open balance entry in G/L.  If not you will have to create some temporary g/l account and add amount to it with a comment, saying from previous system of something like that. Then balance it against bank's external account.
There are many approaches to handle this. You should talk to your accountant what best practice he suggests from the point of view of management reports and even taxation reports or investor reports. As a systems guy you can not arbitrarily decide that.
It is best to create and match balance sheet in new system against the old system and make sure they match before starting new transactions on new B1 platform.