Accrual / Cash Acct

[Christopher Lam]

Hi prl
Thank you for your comment -- I'd like to (genuinely) ask:
* While I'm aware that my method (bank statement verbatim copy) negates one
of the benefits of bookkeeping (i.e. double-checking the bank's records),
how do people/accountants cope with the result that -all- source documents
and the relevant transactions will have different dates?
* I also have a -lot- of direct debits e.g. professional registration fees,
council payments, rent, electricity, and water rates -- do people actually
plan each one as SX?
* I may try a more strict bookkeeping method when I start a new life
(Australia of all places) and will surely have more questions then!
Thanks again


On 19 January 2013 00:41, prl <prl at ozemail.com.au> wrote:

> On 19/01/13 04:17, Christopher Lam wrote:
>
>> ...
>>
>> I have little inclination to change my practices especially that I
>> understand some of the risks. I prefer trusting my bank statement far
>> more than I wish to enter individual transactions and try reconcile
>> every month. But does anyone have any particular advice on what
>> exactly I'll be missing by this method?
>> ...
>>
> The idea of recording your transactions when they are made is that the
> GnuCash balance includes the value of payments that you have made, but are
> yet to be debited from your bank account. In my experience, this is useful
> because there are often delays between making a payment and the debit
> appearing in the bank account, which sometimes happens here in Australia
> for credit or debit card transactions. It's particularly useful for keeping
> track of cheque payments, as, at least in this country, they typically take
> several days to clear, and there may also be delays in the trader
> presenting the cheque for payment. However, cheques are little used here
> (we wrote two cheques in 2012 and four in 2011).
>
> Reconciling the account checks whether your record of the transactions
> matches the bank's. Differences between the two are most often due to my
> error, but doing a reconciliation helps find unauthorised transactions,
> including fraudulent ones. I've found a couple of transaction errors
> through reconciliation, and have been able to have the amounts refunded.
>
> If you simply copy the bank's transaction record into GnuCash, I'm not
> sure what role GnuCash is playing for you.
>
> Peter
>