DESKTOP EDITION CLOUD EDITION SERVER EDITION GUIDES FORUM

Bank account balance summary does not match register


#1

Relating to bank accounts, summary shows the correct amount, bank tab shows the correct amount, if you click on the dollar amount the register shows the correct amount. However, if you click on the bank account to spend or recieve money the amount is not correct. The strange thing is the problem is not consistant. Running the lated release. Any Ideas?


#2

I have this problem, too, after installation of v15.0.83. In my case, I’m missing the opening balance entry (which was $0.00) and the transfer of funds from cash on hand to a checking account. The cash account now shows a figure too high and the checking account too low by the corresponding amount.

@lubos, I suspect this has something to do with the fact of the transfer. Also the transaction characterizations (spend money, receive money, transfer) are now missing. Was that intentional?


#3

My problem is only affecting one account.


#4

@lubos, I was mistaken. In my case the missing transaction was not a transfer. It was made via a journal entry because part of the amount deposited to the bank account was an equity contribution. All the spend/receive/transfer transactions show in the drill-downs via the accounts, just not the journal entries.

That was a little harder to spot because those transaction categorizations I mentioned are no longer there.


#5

The difference between bank account balance and transactions in bank register will be posted journal entries directly to bank account.

If you upgrade to the latest version (15.0.84), Manager will show you the list of journal entries in question. Is it possible for you to re-enter those journal entries as proper bank transactions using “Spend money” or “Receive money” buttons? If you have too many to re-enter, let me know but there shouldn’t be too many.


#6

@lubos That was not my problem. There were duplicates on the banks register that there presented transactions that were dated before my opening balance. Speaking of unrepresented transactions, when will we see the improved reconcile process. As it is currently, I am reconciling by old fasioned pen and paper.


#7

Yes, that’s actually another reason. Previously these transactions weren’t shown in bank register at all since they have been dated before opening balance date. The problem with this approach was that if someone went and set opening balance to some recent date, all those transactions dated before in bank register would suddenly disappear as if Manager lost them. This caused major shock to some users.

So now I still show them in bank register (the right thing), I’m just marking the date in red color to indicate they are not going to be included in general ledger.

As per reconciliation process, I’m currently working on banking module and this will be addressed in upcoming days.


#8

If they do not show on the GL are they still going to show on reports and the amount flow through through the appropate chart of accounts?


#9

No, they won’t be shown on any report. It would conflict with opening balances.


#10

@lubos, I have upgraded to version 15.0.85. Things are not quite as you say. When I drill down into a bank or cash account, I see a warning that 1 journal entry is posted but not shown. It tells me to re-enter as spend/receive/transfer. But nowhere can I find the list of journal entries in question that you mention. But, of course, you are correct that there are not many, and I know which transaction it is.

The problem is that I cannot enter the transaction as receiving money, because the receive money dropdown account list does not include equity accounts. The missing transaction was opening a new bank account with money coming from two sources: cash on hand and a new contribution of capital from the owner (me). So I needed a 3-line journal entry, for example:

Dr: Checking account $100
Cr: Cash on hand $15
Cr: Owner equity $85

Now, I could split this and make a transfer from cash to checking account. But I would still need a journal entry for the capital contribution, since the equity accounts don’t show.

I am not sure what your reasoning is for not having journal transactions show. I believe all transactions in a double-entry system should be reducible to journal entries. The other features are conveniences, albeit very nice ones.


#11

The “1 journal entry” is a blue link which is clickable.

You have probably renamed Retained earnings account to Owner equity which is perfectly valid. Retained earnings account cannot be used currently on receipt/payment level. I might reconsider this.

However you are saying these are opening balances, why not enter them as opening balances as per the guides? See http://www.manager.io/guides/miscellaneous/setting-up-opening-balances/

That was originally my view too and it’s true if all you want from the system is a basic set of financial statements. The business reality is that subsidiary ledger reports which businesses depend on require more information to be accurate and it’s impossible to determine context from journal entry.

For example, let’s say you credit Inventory on hand account by journal entry and there is a report which needs to differentiate between inventory write-offs and returns to suppliers. It’s impossible for the system to determine what the credit to that account represents if it’s done in journal entry. But if this credit is originated on Spend money or Debit note transaction type, you know it’s a return to supplier and not inventory write-off.

Another example, you need to report to tax authority your VAT sales and VAT purchases. So every credit to VAT tax account is a sale and every debit to VAT account is a purchase right? Well, not really. Some debits could be refunds to customers or discounts given to customers rather than purchases. Manager knows what is sale or purchase for tax purposes because it’s looking at the transaction type. Debiting VAT account on spend money transaction is definitely a purchase. Debiting VAT account on credit note is offset to sales. This is what user (and tax authorities) expect to see and this is what reports must deliver.

I could go on and on but don’t get me wrong. I didn’t know any of this myself not too long ago. Journal entries give you a lot of freedom but on the other hand they don’t provide enough context subsidiary ledger reports need.

As per why restrict journal entries from posting to bank accounts or cash accounts, one reason among others:

There is going to be Cashflow statement report and those who abuse journal entries to post to bank accounts or cash accounts would find it surprising a lot of non-cash credits or debits appear on that report. This cannot happen if every cash transaction can be entered only as a receipt or payment.


#12

Okay, @lubos, I surrender on some of this. As usual, you have excellent reasons for how you’re doing things. But I’m left with problems.

You are correct that I have renamed Retained earnings as Owner equity. Initially, I was using it as an income summary from the classical accounting closeout process. But after closing my first year using Manager, I realized the potential was there for even more simplicity and almost no work to closing the year’s books. So at the beginning of this year, I renamed it. Now, no capital accounts, no separate equity accounts, and no drawing account. I just use a journal entry to debit Owner equity and credit Checking Acount. (Of course, you can only be this simple if you are a sole proprietor. But most accountants use a retained earnings account only for corporations and limit themselves to owner’s equity for proprietorships.)

I’m certainly willing to adapt. But under the new approach, here are my challenges:

  1. How to add capital/equity contributions to a bank or cash account.
  2. How to draw money.

In both cases, I can solve the problem only by creating a new equity account. But my Summary then shows both Retained earnings and the new equity account. And I need a journal entry to clear Retained earnings to the new equity account. Much simpler the old way. And for a proprietorship, retained earnings is identical to owner equity, so why force separate treatment? This issue would be resolved if you allowed receipts and payments directly to/from Retained earnings.

As to why not enter this transaction as an opening balance, I can’t because it isn’t. The account involved was a new checking account opened after the beginning of 2015. If I define an opening balance for the account, Manager enters it back on Dec. 31, 2013, which I specified as the opening date for the business. These transactions happened part way through 2015, so need to be reflected in this year’s books.

As things stand, I have to put up with bank and cash account registers that don’t match the accounts or use a clumsy workaround with owner equity split between Retained earnings and a second, unnecessary equity account. From my perspective, this was definitely a case of the update being a step backwards.


#13

I didn’t realize someone will use retained earnings this way but it actually makes sense and I will make it an official recommendation for sole traders.

Check the latest version (15.0.87) which now allows to select retained earnings account (or whatever you call it) under payments and receipts thus allowing you to record capital contributions and drawings directly under bank/cash account tabs.


#14

Brilliant! I replaced the single, 3-line journal entry with a transfer from cash to checking and a receipt of funds from owner equity. Everything shows correctly up and down the line. :grinning:


#15

This is my first post on this forum. I LOVE LOVE Manager - thank you, THANK YOU, as an experienced Sage and QB user.

BUT … Lubos please please give us a proper bank reconciliation soonest, as this is the one big let-down of the whole thing. The Bank Rec is the starting point for any finalising accounts, and I can’t do it.

In my view the Quickbooks Desktop Bank Rec is flawless, and would be a perfect model.

Please keep us posted, as from what I see a lot of us are desperate for a proper Bank Rec.


#16

Sorry, my vote is to keep this software development as original as possible. I cringe when I see remarks referring to Quickbooks as a model for anything or “proper” methods based on other software or preconditioned notions. I too once used Quickbooks and became fed up with it. I too questioned some of Lubos’ ideas. In the end I learned to trust his methods and wait for upgrades that inevitably proved to be superior to anything I had imagined. His reconcilliation method is to me exactly what I did in Quickbooks, Quicken or on paper only better. The only difference is perception based on previous software solutions. I am saving countless hours with the current reconciliation method. If Lubos adds another way for some users comfort, I won’t care as long as he keeps the superior current method unavailable in any other software package.


#17

I now have good understanding what’s need to be done. I’m currently working on a concept to be able to enter uncleared bank transactions which can be cleared during bank rec. There will be also alternative “ticking” process like in Quickbooks so for those who don’t have access to closing balances on daily basis, this will be an alternative (more traditional) way of reconciling.


#18

I have used Quickbooks for nearly 30 years. It is double entry book-keeping. So is Manager. QB offers bank reconciliation for those who a) have constant internet connection with their bank accounts and b) those who don’t. If I understand it correctly, Manager offers a) but not b). Many of us - it is sad, I know - need b). I am confident that Lubos will provide a solution that will be harmonious to all, and will not impair your current ease of use in any way! Or have I missed something?