Legacy Field Notes: Bank Feeds and Reconciliations Are Where Drift Starts

Once company settings are in place, the next place bookkeeping files begin to drift is banking.

Bank feeds and reconciliations are often treated as interchangeable.

In practice, they serve very different purposes.

In 2018, I was seeing files where transactions existed, balances looked reasonable, and yet nothing tied cleanly once pressure increased.

This post came out of noticing that pattern.

It reflects how I was thinking about verification, accuracy, and behavioral drift in QuickBooks Online before those ideas were formalized into a named diagnostic framework.

Original Context

Originally written: October 27, 2018
Platform: Facebook For The Love of Bookkeepers

The original blog site was lost during a hosting migration.
The Facebook post below remains the contemporaneous public record.

Cleaning the Bookkeeping Mess: Bank Feeds & Reconciliations

Alright, now that we went over the Company Settings, let’s take a deeper dive into the second part, Bank Feeds & Reconciliations.

Many people don’t know what a Bank Feed is or how it is used in QBO. I hope you enjoy, and most importantly, learn something and thank you for reading.

The WHAT:

Bank Feeds in QBO: What is it? These are all the transactions that have CLEARED your bank account and need to be matched (this is a transaction that has already been entered in QBO), Added (not yet entered in QBO) or transfer (money moved between different banking/credit card accounts).

Reconciliations in QBO: What is it? Reconciling ensures that the items sitting in your QBO Bank register match and tie out with what was cleared from your bank account.

The WHY:

So, this seems redundant right? I mean, If I added the transaction in the bank feed, can’t I just assume that everything is reconciled? NO!!!! That is not necessarily true.

I explain reconciling like this: it is a means for me to double-check my work and the work of others and to verify that all transactions were properly allocated.

This allows me to make sure that the transactions that were entered in QBO were entered to the correct account that I am reconciling.

Have you ever been so busy that you are just typing away because it needs to get done and there really isn’t enough time to get it going? I’ve been there and while reconciling has realized that I made a couple of mistakes that I would not have caught if I hadn’t reconciled the account.

The HOW:

Bank Feeds:

Login to QBO and go to Banking > Choose a Bank > Review (Do this with each bank on your bank feed)

• Is the client using the Bank Feed?
• Are there any error messages? If so, why?
• How many are there?
• When was the last update file ran?

Reconciliations:

Login to QBO and go to Accounting > Reconcile > Summary (Do this with each account you can reconcile)

• Are all bank accounts reconciled?
• Are all credit card accounts reconciled?
• When was the last reconciliation completed?
• Are all Balance Sheet accounts being reconciled? Why? Why not?
• If reconciled, does the reconciliation ending balances tie with the balance sheet?
• How many Balance Sheet accounts are there?

This is just a short list of questions I ask myself when I first start the cleanup process for a new client.

Always consult with a professional who knows what they are doing and really knows the questions to ask to get your banking feeds and reconciliations setup correctly the first time.

I pride myself in being that person who helps struggling business owners construct a better business, form a better team, and create a better process.

Until next time,

Candice Thompson
For The Love of Bookkeepers