Bank Reconciliation Problem

I've used Sage 50 for a long time. I just set up a new company and entered my first set of journals. I did the first bank rec. and entered the open balance of $500.00 on the bank statement. All transactions were reconciled (no outstanding). However the opening balance shows up under Discrepancies and the Unresolved amount does not match the closing balance in the bank statement. What did I miss?

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  • The concept of "Unresovled" is to tell you that you still have not yet compared and checked off everything that is on the bank statement.  If you see the entry in Sage 50 on the bank statement, you check it off and it is now considered Resolved.

    When a bank rec is started in Sage 50, you enter the Start and End dates from the Bank Statement and the Start and and End Balances from the Bank Statement.  This way the program knows what your targets are and can tell you when you have succeeded.

    When it is completed properly there should be no Unresolved amount (=$0.00) and there should be no Discrepancy (=$0.00).

    I would think your current discrepancy is Prior Outstanding entries from a previous period that have not been added to the bank rec when you started.  Click on the Add Prior Outstanding button and add them in.  This is only required on the first bank rec that you complete in Sage 50.  It's probably the deposit of money you made in Dec to get your Jan opening balance.

  • Hello Richard, Thank you for your reply.

    I found out that the Open Balance of the bank accounts has to be entered during the Set Up stage. However even so at the first Bank Rec. the 'Statement Open Balance' field is still blank, which causes a bit of confusion.

    So, Open Bal of the bank accounts has to be entered twice - first at setup, and second at the first Bank Rec. If you only did the second and not the first, that amount would show up as discrepancy. I figured that out and everything has been working fine.

    Thank you for you help anyway.

  • Also, at the first Bank Rec. the familiar window where all the journal entries does not show up, until you click on Prior Outstanding, even though there is absolutely no prior outstanding transactions. I found out that one has to click on Prior Outstanding, does nothing, then that window will show up. I wonder why Sage 50 is designed that way?

  • I wonder why Sage 50 is designed that way?

    Sage programmers do not know that there are no Prior Outstanding entries when you set up the bank rec.  In fact, it is highly unlikely that if you have been running your business for 15 years, then start using Sage 50's bank rec module, that there are no Prior Outstanding entries.  In a high proportion of businesses there are entries posted to the bank or credit card that do not make it to the statement before month end.

    Now consider a company that has been running for 15 years and using QB, not Sage 50 and finally they have seen the light and switched!!!!  They decided to start using Sage 50 Jan 1/21.  They start using the bank rec module for the Jan/21 bank rec.  There were 14 outstanding entries at the end of Dec/20, posted to the bank in QB but didn't hit the statement until Jan/21 because they were all cheques dated Dec 31/20 and all were mailed Jan 2/21.  Because those are in QB, how would the programmers give you the ability to enter them as Prior Outstanding entries unless they gave you access to the Prior Outstanding dialog.  If you don't know you need to enter them, will you?

    The programmers force you to use the dialog before you start completing the bank rec for the first time.  I think there is logic there because the programmers have allowed you to use the Prior Outstanding entries dialog to not only pick from previous entries already recorded in Sage 50 but also to manually enter those that were created in other programs before starting to use Sage 50.

    The Opening Balance of an account at the start of using Sage 50 is not the same as the Opening Balance of the first month you decide to start using the Sage 50 Bank rec module.  Those two time periods, as mentioned before, could be 15 years apart.