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Reconciling Transactions

Reconciling is where you tell FairBooks what each imported bank line actually was, so your books match your bank.

Open Reconcile from a bank account (the button appears once you have lines waiting). You work through the list one line at a time.

The two balances

Two figures sit at the top of the page:

  • Statement balance is your opening balance plus every line you have imported.
  • Reconciled balance is your opening balance plus only the lines you have reconciled so far.

As you deal with each line, the reconciled balance moves towards the statement balance. When they meet, the account is fully reconciled.

Choosing what a line is

Click a line to open it. You then pick one of four actions.

Match

Link the line to a record that already exists in FairBooks: an invoice, a bill or an expense.

  • FairBooks suggests likely records. You can also type in the Find & match search to look through your invoices, bills and expenses.
  • Tick a record to link it. To split one bank line across several records, tick more than one and set the amount for each. The line is ready to reconcile once the allocated amount equals the full line.
  • You can part-pay an invoice: allocate part of a larger bank line to it. An invoice flips to paid only once it is covered in full.

Matching direction follows the money:

  • Money in matches invoices only.
  • Money out matches bills or expenses only.

Note

A bill must be matched in full on a single line. When you match one, FairBooks marks the bill as paid and records the matching expense for you.

Create

Record a brand new expense or income straight from the line, without needing an existing record first.

  • Give it a description and choose the Account from your chart of accounts. You can also add an optional Tag.
  • GST fills in automatically from the account, and you can adjust it. Money in records income, money out records an expense.
  • To split the line across more than one account, use Add split and set an amount for each part. The splits must add up to the full line.

Owner's funds and equity

If the line is money you put into the business or took out for yourself, choose an equity account (for example owner's funds or share capital). FairBooks records it as an equity movement:

  • Money in is a contribution, money out is drawings.
  • It is treated as GST-free, so the GST field is set to zero and locked.
  • It is excluded from your BAS and from your profit and loss, which is the correct treatment for a sole trader moving their own money.

Transfer

Use this when the line is money moving between two of your own accounts.

Pair the line with the opposite line in the other account (for example money out of your everyday account and the matching money in to your savings account). Import the other account's statement first so its line is there to pair with. Transfers between your own accounts are excluded from BAS and profit and loss, so the money is not counted as income or an expense.

Ignore

Hide a line you do not want to reconcile, such as an internal note. An ignored line does not appear in your reports. Ignoring is reversible.

Note

An ignored line still counts towards your statement balance, because it was on your bank statement. It simply stays out of your reports.

Undoing a reconciliation

Reconciled and ignored lines are tucked away below the list. Click Show reconciled & ignored to see them, then:

  • Unmatch a reconciled line to send it back to the reconcile list and remove the links it created.
  • Restore an ignored line to bring it back to the reconcile list.

Warning

Unmatching removes the links and any records the line created, but it never un-pays an invoice or bill. If a bill or invoice was marked paid, it stays paid, and FairBooks warns you to adjust it by hand if needed.

What feeds your reports

As a quick guide, on a cash basis:

  • Counted in BAS and P&L: expenses and income you create, and invoices and bills you match.
  • Kept out of BAS and P&L: transfers between your own accounts, ignored lines, and owner's funds or equity movements.

What's next?