Matching transactions is an important step when it comes to bookkeeping. If you use QuickBooks Online to reconcile your transactions, you can connect your company’s bank and credit card accounts, and the software can be set up to automatically download the banking transactions every day. That imported data can then be used to match transactions.
This step is important for recordkeeping just as much as it is for helping catch errors and make sure reconciliations match. Doing so immediately will reduce the chances of a more serious problem in the future, where it may be necessary to go through months of records trying to identify the source of a discrepancy.
How QuickBooks Online Handles Transactions
When QuickBooks Online downloads transactions, it will attempt to match the banking details to transactions that have already been entered in the system. This can greatly reduce the amount of data entry that you and your employees will have to do. It can also prevent mistakes and help you catch errors if they do occur.
The most common ways QuickBooks Online will attempt to match transactions are: deposits made to the bank that should be matched to either open customer invoices or deposit in transit entries previously entered in QBO; transfers between bank accounts (such as transfers from checking to savings) where a single entry in QBO is sufficient to record the amount to both sides of the transfer; bank account disbursements made to pay items (such as a vendor bills) that were previously entered in QBO.
If you believe a transaction was already entered manually, but the system initially fails to indicate that there is a potential match, click on the transaction, then click on Find Match in the dialogue box. When you locate the transaction, you will be able to match it manually.
If QuickBooks Online can’t find a match, it will recommend different action steps to get the new transaction reviewed, properly coded, and accepted into the books. QuickBooks Online will group all transactions that need to be reviewed in one place. You will have the option to use other QBO banking functionality to properly categorize the bank transaction. This is commonly done by allowing user-defined ‘rules’ to automatically categorize a transaction. Or, you can create an entry (such as a customer invoice or vendor bill) to which a banking transaction can be correctly matched.
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