pending vs. completed transactions
Mike or Penny Novack
stepbystepfarm at mtdata.com
Thu Oct 15 08:41:53 EDT 2009
Maf. King wrote:
>On Thursday 15 October 2009 04:28:33 T. Howell-Cintron wrote:
>
>
>>My bank shows my debit transactions as "pending" for up to a week before
>>they clear, and the date assigned to them on my bank's web site is the
>>date they cleared.
>>
>>I'm in the habit of entering every transaction in to GnuCash as I spend
>>the money, ie. the same day, and this is effecting the running total of
>>the account.
>>
>>Ideally there would be two date fields - purchase date and cleared date,
>>but that's not the way GnuCash works. What should I do? I could update
>>the transaction date to reflect the date it cleared, using the NUM field
>>to order them according to my bank's statement, or I could just continue
>>to do it the way I have been and know that though the running balance is
>>incorrect the total available funds still works out to the right amount?
>>
>>
>>
Should point out here that this is NOT something new in accounting and
is what "reconciliation" is all about. Let's for the moment forget about
modern things like credit cards and debit cards and think of old
fashioned checks.
1) You make out a check and mail it off. Technically the legal date is
when you made "constructive delivery" (the postmark date) but normal to
book the amount (enter the transaction) as of the date on the check.
This is what YOUR books should show.
2) There may be a significant amount of delay before the checks arrive,
are deposited by the recipients their banks, and get returned to yours
for "presentation" though these days with electronics not as much dealy
as in the old days. The bank records the transaction as of that date
which is when the change shows up in the bank's record of your account.
3) Similarly when you make deposits. If you deposited cash or
equivalents (a cashiers check for example) then immediately available
but amounts from ordinary checks not necessarily so and possibly never
available (that check might bounce). But you enter the amounts as of the
deposit date and make corrections later if necessary.
4) Credit and debit cards not all that different except the time delay
normally less, just a day or two. YOUR books should show the date as it
is seen from your end and the bank's as seen from their end.
With a large volume of transactions you perhaps do "on line" banking
access of your account and then reconcile that download or with a very
low volume (my organization averages perhaps 2-3 checks and 1-2 deposits
per statement) you might just wait for the bank statement to do that.
Reconciliation is the process by which you compare what your records
show and what the bank records show taking into account what might still
be "floating" as of the date you reconcile.
Michael
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