Bank reconciliation is one of the hectic tasks that accountants hate to perform at the month’s end. Sage 50 is the most preferred accounting software used by accountants across the globe to manage their business financial records. However, matching every single bank statement with the appropriate creditor or invoice payment in Sage 50 is often a frustrating and time-consuming process.
Aligning your bank statement with the Sage 50 internal records is crucial as it ensures accuracy and integrity. No matter whether you are a beginner or an expert, you often need help in performing the Sage 50 bank reconciliation process. Walk through this blog post to learn more about the Sage 50 bank reconciliation, including the process and benefits.
Feeling overwhelmed by the Sage 50 Bank Reconciliation process? Don’t worry. Simply dial +1-(888)746-5005 and connect with the experts at Sage Online Solution. They’ll guide you through the process, relieving you of the burden.
What do You Mean by Sage 50 Bank Reconciliation?
Bank reconciliation is the process of matching your bank transactions with the accounting software records to ensure accuracy. It’s all about taking control and finding the discrepancies between both statements. When you compare the Sage 50 accounting statement with your bank statement, you can easily find the missing or unrecorded transactions. It’s a repetitive process that needs to be performed at the end of the month, but with the right tools and knowledge, you can do it with confidence.
How do You Perform the Sage 50 Bank Reconciliation?
Sage 50 software allows you to reconcile any account in your charts of accounts. Basically, you can reconcile the cash accounts, bank accounts or credit card accounts. The process to perform the Sage 50 bank reconciliation includes:
• Sign in to the Sage 50 accounting software using your admin credentials.
• After that, click on the Task menu and choose the account reconciliation option. The Sage 50 account reconciliation window will appear on your screen.
• Now, select the account that you wish to reconcile in order to get the list of the existing accounts; type “?” in the account to reconcile field. You can select the LOOKUP button.
• Select the closing date from the bank/ credit card statement as the statement date. This date is crucial as it marks the end of the period for which you are reconciling. Click on the calendar icon on your screen to change the date. Now, enter the Ending balance in the lower section of the window.
• Thereafter, enter the Interest earned in the Income tab and provide the Service/ bank Charges in the Expense tab.
• In the transactions tab, process the transactions as follows:
A. If you imported a statement from a bank or credit card company Website
B. If the transaction has cleared the bank or credit card company
C. If a transaction has not yet cleared the bank
D. If a transaction on the statement does not appear on the screen
• Now, use the Worksheet tab to check your account details.
• Lastly, click on the Process tab. This tab is where the system will compare the bank transactions with your accounting software records and identify any discrepancies. Once the process is over, make sure the matched balance and the statement balance are the same.
• If the difference is zero, the reconciliation process is done successfully, and you can create a PDF of the reconciled statement.
If the difference is not ZERO, it indicates that there are some transactions that have not been accounted for or there might be some errors in the recorded transactions. In such a case, you need to find out the reason for the difference and resolve it before finalizing the reconciliation.
The process to View the Sage 50 Bank Reconciliation Reconciled Report
This is an optional step. In case you wish to view the reconciled report, follow the steps mentioned below:
• In the Sage 50 account, click on the Bank accounts and then choose the relevant bank account option.
• Click on the Reconcile button and then press the OK button.
• Now, choose the VIEW HISTORY option. A PDF file will appear on your screen for each reconciliation, showing the bank account and the reconciliation date
Why It is Important to Reconcile a Bank Account in Sage 50?
The sole purpose of the Sage 50 bank reconciliation is to match the bank records with the Sage 50 account book to ensure integrity and accuracy. This process is not just a task, but a crucial part of maintaining the financial health of your business. Let’s take a quick look at why Sage 50 bank reconciliation is so important:
Enhance Compliance
The bank reconciliation will enhance compliance. When your company’s records are up to date and accurate, it will help in the audit process, which later enhances compliance.
Improved Accuracy
The automated bank reconciliation process will reduce the risk of manual error. Since the manual reconciliation process will increase the risk of errors, automated reconciliation is best.
Better Cash Flow Management
Timely reconciliation of the accounts will improve your cash flow within the organization. You can easily detect the frauds or the unmatched transactions. It improves the cash flow, which will help in making informed decisions.
Increased Efficiency
The automatic reconciliation will save you time and allow you to focus on the strategic activities. The accurate reconciliation results will reduce the risk of audit findings and penalties.
How can the Bank Reconciliation in Sage 50 be enabled?
Follow the below-mentioned steps to enable the bank reconciliation process in the Sage 50:
• Sign into the Sage 50 accounting application and click on the Accounts option.
• Now, open the account you wish to reconcile. Now, in the reconciliation tab, check the Save Transactions For Account Reconciliation box.
• Ahead, click on the SETUP button and choose the income, expense, and adjustment accounts.
• Lastly, press the OK button.
Note: Before initiating the setup process, add the Income accounts, Expense accounts and Adjustment accounts.
Wrapping Up
Bank reconciliation is an automated process that needs to be performed on a regular basis to maintain the accuracy of the records. It is a hectic process that consumes your whole day. Make sure you enter all the necessary details required for the reconciliation process. Hopefully, this post has provided the details on the Sage 50 bank reconciliation process. If you have any further questions, feel free to contact Sage Online Solution experts at +1(888)746-5005.