Reconciling Question

Some how I missed reconciling the month of October, yet I entered in the information for both October and November’s finical statement and November reconciled. Yet when I went back to reconcile October it doesn't reconcile. How do I go back and reconcile October, or is there a way?

craigsh wrote:Some how I missed reconciling the month of October, yet I entered in the information for both October and November’s finical statement and November reconciled. Yet when I went back to reconcile October it doesn't reconcile. How do I go back and reconcile October, or is there a way?

It can certainly be done. The issues you'll have to deal with are:

• Unchecking all of the items (deposits, expenses, transfers) you checked off in November that had not cleared as of October. That probably accounts for the bulk of the issues that are making October out of balance.
• There may be some Temporary Item issues that are required to reconcile October, but had been taken care of in November, so were no longer an issue (e.g., a returned donor check from an October batch, where the corresponding donation was canceled in November).

As I'm sure you've figured out, you should always reconcile each month in order. That's a lot simpler than moving back. Once you have correctly reconciled October, you'll need to return to November's reconciliation, check off all the items that cleared in November, and make sure that it balances again.

craigsh wrote:Some how I missed reconciling the month of October, yet I entered in the information for both October and November’s finical statement and November reconciled. Yet when I went back to reconcile October it doesn't reconcile. How do I go back and reconcile October, or is there a way?

Except for the fact that reconciliations are checked during the audit, if November reconciled, you do not need to reconcile October. However, since it will be checked, you do have to have a reconciled printout for October. Rather than undoing everything you did (and since November DID reconcile), I would recommend just adding temporary adjustments to your October reconcile so that it, too, reconciles.

After you have printed the October report (with unreconciled differences all 0) remove the temporary items you just added and then check that your November reconcile still has no unreconciled differences. You should be good to go. For future reference, as Alan_Brown stated, you should always reconcile your months in order to avoid these types of issues.

crislapi wrote:Except for the fact that reconciliations are checked during the audit, if November reconciled, you do not need to reconcile October. However, since it will be checked, you do have to have a reconciled printout for October. Rather than undoing everything you did (and since November DID reconcile), I would recommend just adding temporary adjustments to your October reconcile so that it, too, reconciles.

After you have printed the October report (with unreconciled differences all 0) remove the temporary items you just added and then check that your November reconcile still has no unreconciled differences. You should be good to go. For future reference, as Alan_Brown stated, you should always reconcile your months in order to avoid these types of issues.

As an auditor, I would have a hard time endorsing this approach. It sounds like the proposal is simply to add temporary items to October's reconciliation so that it balances. That is not reconciliation. True reconciliation requires that you actually check off the cleared items that appear on the statement and bring the MLS and CUFS records into harmony. If an auditor saw all those inappropriate Temporary Items, he should mark an exception.

What I proposed really wouldn't be very difficult -- it's just a matter of unchecking a month's worth of cleared items, then rechecking them. I would think it would be no more difficult than entering Temporary Items, and it would pass the audit.

crislapi wrote:Except for the fact that reconciliations are checked during the audit, if November reconciled, you do not need to reconcile October.

This approach ingnores the purpose for reconciliations and could inject more work later down the line. Reconciliation printouts are a snapshot in time of the financial history or status. Changes made in MLS, such as a later month's reconciliation, may have the affect of making previous months' reconciliations to appear to be unreconciled when viewed in MLS. It is the printed copy of a previous reconciliation that tells the true situation at that point in time.

I would not want to be the person who tried to track down an issue some time in the future (months or even years) and come across that improperly done reconciliation and have to do all the reconciliations from that point forward just to find the actual point of the problem I was trying to resolve.

As Alan stated any auditor is obligated to note an audit exception for any reconciliation that appears to be forced. The presence of temporary items unrelated to CUFS entries is an indicator of just such a practice.

Take the time now to do it right to save someone else the headache and wasted time later.

Alan_Brown wrote:As an auditor, I would have a hard time endorsing this approach. It sounds like the proposal is simply to add temporary items to October's reconciliation so that it balances. That is not reconciliation. True reconciliation requires that you actually check off the cleared items that appear on the statement and bring the MLS and CUFS records into harmony. If an auditor saw all those inappropriate Temporary Items, he should mark an exception.

jdlessley wrote:This approach ingnores the purpose for reconciliations and could inject more work later down the line. Reconciliation printouts are a snapshot in time of the financial history or status. Changes made in MLS, such as a later month's reconciliation, may have the affect of making previous months' reconciliations to appear to be unreconciled when viewed in MLS. It is the printed copy of a previous reconciliation that tells the true situation at that point in time.

I'm not saying I disagree, but the problem is not that the entries for October were overlooked or ignored. It is that they were all entered when the November reconcile was done. So none of the entries have been ignored. Just some of the items in November appear to have reversed something from October.

Additionally, as an auditor myself, I would take the time to read the description of the Temporary items and only mark an exception if I didn't agree or felt the temporary items were inappropriate. The only reason the October one would be off is for the reasons Alan_Brown mentions in his post, which are all valid temporary adjustments, especially since September and November reconciled.

If I go back and try to reconcil October, there are a lot of checks that where check that aren't there to uncheck now. How do I find them again and uncheck them?

craigsh wrote:If I go back and try to reconcil October, there are a lot of checks that where check that aren't there to uncheck now. How do I find them again and uncheck them?

I assume you are talking about checks that were in months prior to October that cleared in November. To uncheck those, you need to go back to the month in which they were written -- just go to the Reconcile screen and select that month and uncheck those checks. You don't need to do anything else in those earlier months except to uncheck the checks that cleared in November.

See this post.