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QuickBooks Reconciliation 

Introduction 

Reconciliation is the process of confirming that the balance in the Accounting books matches the balance in the Statement (gateway statement, bank statement etc).

Reconciliation helps your accounting team confirm that all the amounts appearing in the statement are brought to record into the books of accounts and a clear explanation emerges for the unreconciled items.

Note
  • This feature is available along with Chargebee - QuickBooks Online integration only
  • Chargebee - QuickBooks integration is available only in selected plans. To know more, visit Chargebee's Plans and Pricing  page.
  • Only Stripe Gateway is supported for now

Problem: The trouble with Reconciliation 

Imagine that you have a number of invoices processed on a daily basis. The payments are initiated from Chargebee and processed by your gateway. The gateway transfers the final amount (as a lump sum) at the end of the day or after a few days depending on the gateway, with no correlation to the original Invoices for which payments are processed. The problem statement is as follows:

How do we reconcile the invoices/transactions with the bank statement when one lump sum amount is deposited in the Bank Account (when you do not know which individual invoices make up the lump sum amount)?

Bank Transaction Invoices/Transactions
Sum of $490 credited to the
Bank Account on 4th Jan
Customer 1 - Invoice 001 - $99
(Paid on 2nd Jan)
Customer 2 - Invoice 002 - $99
(Paid on 2nd Jan)
Customer 3 - Invoice 003 - $99
(Paid on 2nd Jan)
Customer 4 - Invoice 004 - $99
(Paid on 2nd Jan)
Customer 5 - Invoice 005 - $99
(Paid on 2nd Jan)
Note

Stripe cannot be connected to QuickBooks to download the statement (as you can do with your bank accounts)

The Reconciliation process can be simplified by following the steps mentioned below [this is a recommendation from Chargebee and may vary based on different accounting practices]:

  • Create a Bank Account for the Gateway (in addition to your physical Bank Account)

  • Download Gateway statement from Chargebee

  • Upload Gateway statement into this Bank Account

  • Use Chargebee's Chrome plugin to perform Reconciliation

Note

Currently, Chargebee only Stripe.

In the same example above, an account is created in QuickBooks and the gateway statement is uploaded.

Invoices/Transactions Gateway Statement Bank Transactions
Customer 1 - Invoice 001 - $99 (Paid on 2nd Jan) Transaction processed, for $99
Customer 2 - Invoice 002 - $99 (Paid on 2nd Jan) Transaction processed, for $99
Customer 3 - Invoice 003 - $99 (Paid on 2nd Jan) Transaction processed, for $99
Customer 4 - Invoice 004 - $99 (Paid on 2nd Jan) Transaction processed, for $99
Customer 5 - Invoice 005 - $99 (Paid on 2nd Jan) Transaction processed, for $99
Processing Fee
$5.00
Transfer $490 to
Bank account on 4th Jan
Sum of $490 credited to the
account on 4th Jan
Note

The gateway processing fees will be aggregated and shown in the gateway statement export if the multiple fee line items were applied in your gateway statement.

Setup QuickBooks Reconciliation using Chargebee 

Step 1: Download Gateway Statement

  • Connect your Chargebee and QuickBooks accounts.

  • Navigate to the QuickBooks Integration sync settings from Settings > 3rd Party Integrations > QuickBooks.

  • Click on Get Gateway Statement.

  • Select the date range for which the statement should be downloaded.

  • You will be notified when the statement is available for download > once you receive the notification, download the statement.

Note
  • The Get Gateway Statement option is enabled only on request, kindly drop in an email to support@chargebee.com  and we will enable this option offline.

  • Gateway statement can be downloaded for transactions made after Mar 15, 2017 only.

  • When you provide a date range, you can select dates within 2 months range only while exporting the gateway statement.

Step 2: Upload Gateway Statement in QuickBooks

If you have an existing gateway account in QuickBooks to manage the gateway statement, you can use that, else create a new Bank chart of account and import the Gateway statement.

Step 3: Run Google Chrome Extension and start automatic Reconciliation

  • After the gateway transactions have been imported into QuickBooks, run the plugin.
  • The plugin will start searching for transactions and find matches automatically.
Note
  • If a match is not found, the extension will skip the entry and proceed to the next transaction.
  • The extension will not match Gateway Fees and Settlement/transfers to Bank, these should be reconciled automatically (as explained in the following steps).

Step 4: Review the Reconciliation items

  • Click on Reconcile option in the Settings menu.

  • Enter the details of the gateway account to begin the review process.

  • The payments and refunds will be displayed and QuickBooks will show the matched entries as auto-selected.
  • Click on the Finish Now option.

Step 5: Map the Gateway processing fees

  • Navigate to the Gateway account.

  • Select an expense (or any Account) and map the gateway processing fees.

Step 6: Transfer settlement amount to a Bank Account

  • After the Payments and refunds are reconciled between, the settlement entries should be reconciled.

  • You need to transfer the lump sum amount from the Gateway account to an actual Bank Account.

  • Now run the Reconciliation process for the Bank Account as well.

Reconciliation is now complete, all entries are processed.

FAQ 

How will the gateway statement be converted into QuickBooks understandable format?

When you download the statement from Chargebee, Chargebee will understand the gateway type and convert it to a format accepted by QuickBooks.

How are multi-currency invoices managed?

For Multi currency users, the exchange rate will be derived from the Gateway (by calculating the exchange rate from the original and converted amount)

How will offline payments be reconciled?

  • Offline transactions will be sent from Chargebee (You can provide a specific account name as part of QuickBooks Online integration setup process).

  • Offline transactions will be downloaded into QuickBooks via the Bank Statement feed.

  • You should manually match the Offline transactions.

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