Bank Reconciliation in, simple terms, is matching your businesses own accounting records to the record of your bank balances. Its main purpose is to see whether there’s a difference between the two records as it concerns your cash transactions.

The process of trying to manually match each entry in your bank statements to your own records requires laser sharp attention to details. One overlooked number will result in a fairly unbalanced financial statement.

So how can Xero help you do your bank reconciliation?

Xero was designed to automatically import your transactions from the bank, credit card and even PayPal.

Using these imported information, called “bank feeds”, you no longer have to input each one of your transactions. Instead, you are afforded with the convenience of only having to double check if the entries are indeed correct.

Features of Xero Bank Reconciliation

Xero remembers recurring bank transactions from previous input. It suggests these items saving time inputting the details. This is called “auto suggestion”.

Use “Bank Rules” to categorise same transaction types. In that way, if can give you an overview of this particular expense classification. You can create a rule on common transaction items such as “telephone expenses” and “wages”. You can produce several rules to further automate the process.

If you are unsure of the transaction at hand, Xero has a “discuss” tab which allows you put a note or comment in for your accountant/bookkeeper to check. Your accountant or bookkeeper will be able to see this note to give an advise on how to go about it.

Xero intelligently tries to anticipate recurring transactions by looking at the transaction details such as name, reference number and the amount.

Doing Bank Reconciliation in Xero saves time, effort and ensures you’d be able to have peace of mind knowing everything is exactly how it should be.

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A sample bank reconciliation dashboard on Xero, PayPal

If you’re using Xero but not sure how to maximise it, don’t hesitate to reach out.

If you’re new to Xero or is looking for a reliable service, we can help you setup Xero for FREE, just give us a call so we can discuss.

Jodie Thompson

Jodie Thompson

Jodie is a qualified CPA and company director having managed her own accounting and advisory firm for over 10 years. Jodie’s experience in establishing and growing businesses is second to none and her hands on approach and technical expertise is valued by our team and our clients alike.

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