The following is an exerpt from the GPUG Tech Tips for August 2012.
Most Common Reasons for Variances in Balances
There are two common reasons why the Bank Reconciliation Checkbook Balance and the General Ledger Checkbook Balance do not match.
- There are unposted batches in the General Ledger. There are some transactions (e.g. Payables Management Computer Checks) that post to both the Bank Reconciliation AND the General Ledger. When these items are posted in their originating module, they automatically post in Bank Reconciliation affecting the balance; HOWEVER, depending on how you have your posting options setup, they may sit in an unposted batch in the General Ledger. This is easy to solve: Simply post your batches in the General Ledger.
- Deposits haven’t been created in the General Ledger. This is a similar scenario to the previous reason, but somewhat in reverse. When payments received are entered in Receivables Management, Sales Order Processing and as receipts in Bank Reconciliation, they are sent directly to the General Ledger but placed in a holding spot to be entered on a deposit. Why? For easier bank balancing (and easier bank transactions analysis). Deposits in the Bank Reconciliation module should match the actual deposits with the bank. However, the General Ledger module may need to be setup to show the detail of receipts or set to “summary” depending upon your needs or desires. The solution: Check your Bank Deposit Entry window for any receipts not deposited.
How to Find Other Variances
What are some of the other reasons that the two would be out of balance?
Coding Error: You should never manually enter the Bank Account GL account. It will always default automatically when the Checkbook ID is referenced.
- A General Ledger was coded to the GL account that represents the Checkbook. If you are using Bank Reconciliation, this is a BIG NO NO!
- A Distribution Entry for a non-GL module was coded to the GL account that represents the Checkbook for a line other than CASH for the Distribution Type. Also a BIG NO NO!
Date Error: Document dates and the GL posting date span different fiscal periods.
To find errors, pull up the Checkbook Balance Inquiry window referenced above starting with the first day of the month or perhaps the first 10 days of the month and compare to the GP Report, the General Ledger Trial Balance for the same date range. Keep adding a day(s) until you find the entry that is causing the problem.