This is the first part in a Xero training where I’ll show you how to reconcile your account by creating new transactions.
- On the dashboard click a blue Reconcile link in a bank accounts tile
- In the box to the right of an item select the Create tab
- Enter Why
- Click “+ New Contact” if the contact is not already in Xero
- Enter What
- Enter Why
- Click the OK button between the transaction and the Create tab
Keep reading for full instructions with screenshots.
In other accounting software, like QuickBooks, reconciling means comparing your bank statements to your account. And making sure everything matches.
In Xero, reconciling means reviewing and organizing transactions that have been downloaded from your bank accounts.
When viewing the dashboard your bank accounts will have a blue link telling you how many items need to be reconciled.
Let’s click on one of those links to begin. You’ll be taken to that bank accounts reconcile screen.
On the left-hand side of the screen you’ll seen the items that need reconciling.
On the right-hand side across from each items is a box with actions you can take.
- Match with an existing transaction
- Create a new transaction
- Log it as a transfer between accounts
- Discuss (add a note to the item)
In this tutorial I’m going to show you how to create a new transaction.
I’ll start with the first item in my list. A Paypal transaction where I paid Score $30.
There’s nothing else that needs to be done and no confirmation. The contact is automatically added when you click that.
Next is the “What” drop-down menu where you select the reason you paid this contact. I’ll be selecting Education Expense.
The Why field is for adding an optional description.
When you’re done click the OK button that appears between the item and the action box.
When you click OK the item will disappear from the list and the number next to the bold Reconcile at the screen will go down by one.
The next item in my list is money received but I know this was a refund. When I create this transaction I’m going to select the expense account it was originally spent from.
That’s the end of this part of the training. In part two I’ll show you how to reconcile your account using the Cash Coding tab.
If you’d like to watch me walk through this process check out the video below: