Reconcilliation

[Buddha Buck]

A reconciliation is an attempt to verify that you and someone else have the
same view of an account. When you reconcile against the bank statement, you
are verifying that both you and the bank agree on what has affected that
account.

When you enter a transaction (such as a $500 loan to the business for the
purposes of keeping the bank account above zero), in your books that
transaction affects two accounts: the business checking account, and the
liability account tracking that loan. In GnuCash terms, the single
"transaction" has two "splits", with one split linked to the bank account,
the other linked to the liability account.

When it comes to reconciliation, the bank knows nothing about the split to
the liability account. It doesn't know, or care, where the funds in the
checking account came from, just  that the transaction was $500. As such,
it is impossible for you to reconcile that liability account split against
the banks records. But you can reconcile the checking account split against
the banks records. If the lender of the $500 cushion issued a statement,
giving what your business owed, you could reconcile the liability account
against that statement separately from the bank's reconciliation.

In GnuCash, transactions aren't reconciled, splits are.

It sounds like you are using GnuCash properly, but might not be expecting
what you are seeing.


On Sat, Oct 1, 2016 at 6:12 PM mrfox99 via gnucash-user <
gnucash-user at gnucash.org> wrote:

> Hi
> I am new to GNUcash and I have a start up business.  Having watched some
> very helpful starting youtube videos on chart of account set up and initial
> transaction creation, I've found it very easy to use and straight forward.
> My issue is when I come to reconcile - here is my scenario, hopefully
> someone can tell me where I am going wrong. My set up is for Canada.
>
> We opened our business account and in the first month our account fee was
> deducted so our account went into a negative.  So, at the end of the first
> month, the bank was -$6.00.  I inputted this transaction as a bank fee of
> $6.00.  We transferred in $500 as a buffer to set up the business - a
> personal loan if you like to credit the account, so I entered this as a
> Liability under Loans as essentially the business needs to pay that money
> back.
>
> My issue is that when I go to reconcile the month end, I reconcile the
> first
> month with end balance of -$6.00, as this is the statement end balance.
> When I go to reconcile the second month, it only seems to want to reconcile
> either the expenses OR the credit piece - I seem to be unable to see both
> of
> these transactions in the reconcilliation window at the same time.  Is this
> a setting issue or am I entering this incorrectly?
>
> Sorry for being dumb - just trying to find my way and make sure the start
> up
> piece is completely correct!
>
> Thanks for the guidance.
> Colette
>
>
>
> --
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