QuickBooks desktop is one of the most popular accounting software tools that businesses use today. It offers everything you need to manage your business.
However, as you reconcile the account in QuickBooks Desktop, you open the Begin Reconciliation window, and it displays a zero or incorrect Beginning Balance.
The following are some reasons behind beginning balance issues in QuickBooks Desktop, and some ways to deal with them:
Causes of Beginning Balance Issues in QuickBooks Desktop
- You didn’t enter a balance, or you entered an incorrect balance when setting an account.
- Your earlier transactions were deleted, voided, or modified.
- This can also occur if you imported a file from another version of QuickBooks.
Fixing Beginning Balance Issues in Quickbooks Desktop
Here are some tips to help you resolve beginning balance issues in Quickbooks desktop.
Quick Steps to correct a zero balance
Recreate the opening balance
It’s important to correct this error as soon as possible when you reconcile your account. Unfortunately, QuickBooks doesn’t provide a way to correct this error directly from the Begin Reconciliation window. Instead, you must create an adjustment journal entry and perform a mini reconciliation to correct this error.
Step 1: Firstly, you have to make a journal entry using the correct date and amount you want to see in the Begin Reconcile window.
- Open Company menu, then click on Make General Journal Entries.
- Set the statement date to the correct date from the starting balance.
- In the Account drop-down menu, select the appropriate account.
- In the Debit column, enter the correct opening balance.
- Select Opening Balance Equity on the second line and Select Save.
Step 2: To rectify the Beginning Balance, you need to perform a mini-reconciliation.
- Open Banking menu, then select Reconcile.
- Using the Account drop-down, select the appropriate Account.
- Now, you need to enter the statement date and ending balance that match your journal entry and select Continue.
- Select the corresponding Journal Entry under Deposits and Other Credits.
- Please note that the Difference displayed should now be zero.
- Finally, Select Reconcile Now.
Quick Steps to fix an incorrect balance
Correct edited, deleted, or cleared transactions
To correct the issue of incorrect balance you will need to review each of the transaction categories. Then you can determine which of the three transactions is at fault. To do this, run the following reports:
- Reconcile Discrepancy Report
- Audit Trail Report
Run Reconcile Discrepancy report
- From the Reports menu, choose Banking, then Reconciliation Discrepancy.
- Select the appropriate account, then choose OK. You now have a list of transactions that have changed since the last reconciliation. Use this report to identify the transaction causing the problem.
- If you find an error, note the date of the transaction and the date that the information was changed.
Use the Audit Trail report
- Open the Reports menu, click Banking and then Previous Reconciliation.
- Pick the appropriate account that is to be Reconciled.
- Now, pick the most recent statement date. Choose Transactions cleared at the time of reconciliation then click on Display.
- Make note of statement and the reconciliation creation date.
- Now Open Reports, select Accountant & Taxes, then Audit Trail.
- To reconcile an account, first you need to set the Account filter to that particular account. To do this, follow these steps:
- Select the Customize Report Tab
- Open Filter tab, then click on Account from the filters
- Now, go to Account drop-down, and pick the appropriate account.
- On the Display tab. Fix the Date filter with the From field blank and the To date set to the statement date and then Enter Ok
- Next, you need to set the Entered/Modified filter to look at entries that were made on a previous reconciliation creation date from the PDF, and the To field as today’s date
- Check if any of the transactions in the report can account for the issue.
Previous Reconciliation report
If you’re using QuickBooks Desktop Pro, the reconciliation report will be the most recent one you can access. To keep a copy of previous reports, save a PDF copy on your hard drive. See View previous bank reconciliation reports to learn more.
- To view your previous reconciliations, go to Reports > Banking > Previous Reconciliation.
- Choose the appropriate Account and Statement Ending Date. Click Display.
- Compare the information in this report to your previous statements.
Undo a previous reconciliation and redo it
- Firstly, create a backup of the QuickBooks company file.
- In the Begin Reconciliation dialog box, select Undo Last Reconciliation.
- When you are asked to select Continue, choose OK.
- Finally, Close and reopen the Begin Reconciliation window.
