Before you start your bank reconciliation
What you need to do before you can start reconciling your bank account, how you know when to reconcile, and how Xero helps you.
Enter transactions in Xero
Enter these transactions before reconciliation
- Customer credit note cash refunds
- Supplier credit note cash refunds
- Expense claims
- Expense claim payments
Enter these transactions before or during reconciliation
- Invoice payments
- Bill payments
- Spend money transactions
- Receive money transactions
- Bank account transfers
How you know when to reconcile
Look for a Reconcile [number] items button on the Bank Accounts screen or the Dashboard in Xero. You'll see this reconciliation button whenever transactions are imported from your bank account into Xero ready for you to reconcile.
How Xero helps you reconcile
Xero follows these steps, in this order, to help you reconcile.
Xero tries to match
Xero automatically matches imported bank transactions with transactions entered in Xero.
Xero looks for rules set up
If Xero can't make a match, but can match a condition of a bank rule you've set up, Xero suggests creating a transaction. The suggested transaction contains all the details of the bank rule.
Xero makes a suggestion
If there is no match or bank rule to apply, and you have turned on Suggest previous entries, Xero suggests creating a transaction. The suggestion is based on a previously reconciled transaction with similar details. Xero suggests the Who, What, and Why, so the transaction is ready to reconcile.
To turn on Suggest previous entries, simply select the checkbox at the end of the bank reconciliation screen.
You'll need to review each match or suggestion to make sure it's correct. If Xero doesn't make a match or a suggestion, or has made an incorrect match or suggestion, you can search for or create a transaction.