How Do I Reconcile My Cash Account?

How Do I Reconcile My Cash Account?

A Cash Reconciliation is simply a check that the Cash on Hand per your Records equals the Actual Balance of Cash on Hand. This can be done as often as you wish.

The Cash on Hand per your Records automatically calculates from:
- the Opening Cash Balance which transfers from the previous month,
- the Receipts Not Banked entries in your Money In Record,
- and the Total Cash Payments column in your Money Out Record.


The formula that is used is simply:

Opening Cash Balance + Receipts Not Banked (from your Money In Record) - Cash Payments (from your Money Out Record) = Cash on Hand per your Records.
 

Recording your Opening Cash Balance

  1. 1. Click on the Cash Reconciliation tab.
  2. 2. Change to the month in which you are commencing your records.
  3. 3. Click on the [Settings] button.
  4. 4. Record the Opening Cash Balance. (Your records may be locked as a result of your Opening Bank Balance. If so, click on the Bank Reconciliation tab and on the [Unlock] button. Then return to Money In.) 
  5. 5. Click on [OK].

 

Reconcile your Cash:

  1. 1. Click on the Cash Reconciliation tab.
  2. 2. Count your cash on hand and type the amount into the box for the current amount of cash on hand.
    • - If the Cash on Hand per your Records is the same as the Actual Cash on Hand then your cash reconciles. If they do not agree you should check your records and recount your cash on hand to see if there is an error.
  3. 3. If you cannot find an error and your cash does not reconcile, the discrepancy must be recorded in the Money In or Money Out Records to correct the error. 
    • - For example, if your actual cash on hand is $5.00 less than the balance per your records, you need to record the discrepancy in your Money Out Record.
  4. 4. Open the Money Out Record and go to the next line available. 
  5. 5. Record the date of your reconciliation in the Day column. Arrow to the Details column and type ‘Cash Discrepancy’. Record the amount of the discrepancy in the Total Cash Payments column. Now record the amount in Sundry Other Non GST Payments column. If you now click on the Cash Reconciliation tab, the Balance of Cash on Hand per your Records has been changed to reflect the entry you have made and should now reconcile with the cash amount you typed in.
    • - If your actual cash is greater than the amount of balance per your records, record the ‘overage’ discrepancy in your Money In Record.
  6. 6. Open the Money In Record and go to the next line available. 
  7. 7. Record the date you are reconciling in the Day column. Type "Cash Discrepancy" in the Details column. Record the amount of the discrepancy in the Total Receipts column, Other Non GST Receipts and Receipts Not Banked columns. If you now click on the Cash Reconciliation tab, the Current Cash on Hand per My Records has now changed to reflect the entry you have made and should now reconcile with the cash amount you typed in. 
  8. 8. You can complete your Cash Reconciliation at any time. However, you must record any discrepancies in the Money In or Money Out Record at the end of every month so that you do not carry forward an incorrect balance to the new month.

    • Related Articles

    • Completing your Cash Reconciliation

      A Cash Reconciliation is simply to check that the Cash on Hand per your Records equals the Actual Balance of Cash on Hand, in the “Cash” Account of your file. This can be done as often as you wish. The Cash on Hand per your Records automatically ...

    • What Do I Do If I Cannot Reconcile?

      1. Check that the Opening Balance per your Records is the reconciled balance from the month before. 2. Check that the amount you have typed into the Bank Statement Closing Balance is the end of the month balance according to your Bank Statement. 3. ...

    • What Do I Do If I Cannot Reconcile

      1. Check that the Opening Balance per your Records is the reconciled balance from the month before. (To find your Opening Balance, click on [Settings], then click on the Opening Bank Balance tab). 2. Check that the amount you have typed into the Bank ...

    • How Do I Import My Bank Statement for Bank Reconciliation?

      A Bank Reconciliation is simply a process that matches your Money In and Money Out Records with your Bank Account. It is an important process because it provides you with a check as to the accuracy of your records and can therefore save your ...

    • Cashflow Manager Basics

      Cashflow Manager records the money in (Receipts) and money out (Payments) transactions of your business. You can also reconcile your bank and cash transactions to ensure that your records are accurate and in preparation for lodging your GST and BAS ...

    • Popular Articles

    • Completing your EOFY payroll

      Finalising your year-end payroll It's important to note the final pay period for the financial year is the one that is PAID before the end of the financial year. The first pay period of the next financial year is the first one that is PAID during the ...

    • Starting a New Financial Year in Wages

      You can start a new financial year by following the below steps: 1. In the Employees section of Wages, select [Tools] in the top left 2. Select [Financial Year] 3. Select [Start New Financial Year] 4. The financial year ending will read 202X, select ...

    • End of Financial Year Checklist

      Be prepared and organised this end of financial year, with our easy-to-follow checklist. You can view and download the checklist here. We’ve provided seven steps to make your reporting as stress-free as possible, and if you’ve been using Cashflow ...

    • Single Touch Payroll Guide

      As a subscriber of Cashflow Manager, all fees involved with lodging your records via Single Touch Payroll are included with your Cashflow Manager Gold, Wages Manager or Wages 1-4 subscription fee. If you have any questions regarding Single Touch ...

    • Deleting Old Pays from the STP Event Lodgement Screen

      Continue if you have previous pays listed in the Single Touch Payroll screen that you do not want to send. From the [Tools] menu or on the right-hand side of the Employees screen in wages, select [Single Touch Payroll] to open the Single Touch ...