How do I process a bank reconciliation?

article ID: 2022208 

 

Please see below for an overview of how to use Bank Reconciliation in Mamut Business Software:

 


Reviewing previous reconciliations and creating a new reconciliation


1. Open the Bank Reconciliation screen by clicking on the View - Accounting - Bank Reconciliation menu.

2. You can view existing reconciliations by using the drop-down menu in the top-right of the Bank Reconciliation window.

3 .In this screen you can:

  • Open existing reconciliations by clicking on the Edit button in the toolbar.
  • Print a summary of the bank reconciliations by clicking on the Print button in the toolbar.
  • Create a new bank reconciliation entry by clicking on the New button in the toolbar.

 

Processing a New Bank Reconciliation

1. When you have chosen to create a New bank reconciliation, the first choice you need to be make is which Nominal Code the reconciliation applies to. Choose the account you want to reconcile from the drop-down menu. To proceed further please click OK. Note! The first time you create a bank reconciliation for an account, you will be given the chance to enter the Start date for the account. This will result in filtering out all transactions with the journal date prior to the specified date. In addition, you can also enter the Opening balance for the account if you have not entered it correctly or completely previously. This will in principle be the Opening balance on your statement that you wish to begin the reconciliation with (or the closing balance of the previous statement). If, for example, you wish to start on 01/01/2011, then find the closing balance at 31/12/2011 and enter this as the opening balance

2. A new screen will open. This screen is split into two parts.


The top section has information about the previous reconciliation (shown in the area with the blue background) and the current reconciliation (editable fields with a white background).

The bottom section has information on where the entries on your bank statement are recorded. Corresponding entries can be extracted from the ledgers by clicking on the New icon in the lower toolbar - a list of appropriate entries will pop up:

  • Select individual items to be added to the reconciliation by placing a tick in the check-box in the left column.
  • Select all the items by clicking on the Select all button. You can subsequently remove any items that should not be included.
  • Remove all the items by clicking on the Remove all button. You can subsequently add back any items that you wish to include again.
  • Click OK when you have finished selecting items.

3. You have returned to the principal Bank Reconciliation screen. If the closing balance on the statement matches the closing balance calculated by Mamut Business Software, the Approved button will be active. If there is a mismatch, the Approved button will be greyed-out. Check that you have selected all relevant items.

4. Once all items have been added and the amounts reconciled, click Approved to close the reconciliation.

5.The bank reconciliation will be marked as approved and closed.

 

Processing an Initial Bank Reconciliation for new users of Mamut Business Software who were previously using another software application such as MYOB

The steps below are a guideline for users who were previously using another software solution where they have been reconciling the bank account, and now have started using Mamut and wish to reconcile the bank account for the first time. These steps involve recording unreconciled transactions into your bank account as per your last reconciliation so that they can be reconciled within Mamut at a future date. The instructions below will assume you were previously using MYOB software, however the principle will apply to other products as well:


1. You should already have a balance on your bank account in Mamut Business Software as you should have recorded all your nominal account balances based on MYOB results (Trial Balance). This balance should be the same as the closing balance of your bank account on MYOB indicated as your bank balance. This balance may/will include un-reconciled cheques and bank deposits depending on when you last reconciled your bank on MYOB. So please open your MYOB company file and print out your Bank Reconciliation report using the last reconciled date you reconciled your Bank on.

2. Printing the above report should show you all un-reconciled cheques and bank deposits that were still left in MYOB when you took the balance over to Mamut Business Software. We need to show these transactions as separate individual transactions on Mamut Business Software.

3. On Mamut Business Software, go to View - Accounting - Journal Entry to record a new journal. All your lines on the journal will be to your bank account (so this means you are not really changing the balance of your account by recording this journal, you are however introducing the unreconciled transactions as entries that you will be able to reconcile later on).

4. For each un-reconciled bank deposit payment you received, DEBIT your bank account. For each un-reconciled Cheque Payment you have made CREDIT your bank account. In order to balance the journal, you may have to either Credit or Debit the Bank Account by the difference of your total Debits vs Credits. Make sure that there is no VAT on any of these lines on the journal. You can record the journal as an Opening Balance type of journal and you can date it to be the same as your other Opening Balance journals from MYOB - this should not really make any difference to your Profit & Loss or Balance Sheet reports as all the lines on this journal are to the same bank account. What you are achieving by recording this journal is to split the balance you brought forward from MYOB into the individual un-reconciled transactions based on MYOBs last reconciliation report. Before you record this journal and post it to your financials, try and use the Details column to put in some more description of the transactions as this will help you recognise them when doing the reconciliation later.

5. To perform your first reconciliation on Mamut Business Software, you would key in the same statement date and balance as the last reconciliation you did on MYOB. You should be able to flag both the opening balance value you brought into Mamut Business Software as well as the balancing value to your bank account that you entered on the journal in step 4. This should allow you to reconcile your Bank account to be in line with MYOBs last reconciliation leaving the un-reconciled transactions on the journal you recorded in step 4 above as well as any new bank entries you may have recorded on Mamut since you started using it.

6. You should now be able to reconcile your bank account with your more current statement dates going forward.

 

Query words: bank reconciliation