How to adjust an account so you can start reconciling from now on?

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I currently only reconcile the main business account, I want to start reconciling the tax account and credit card. These accounts have been used in quickbooks for years but never reconciled, how do I start reconciling now starting this f/year? Balance is a long way out. 

**Edit - Would it be easier to make these accounts inactive as of 30/6 in quickbooks - and setup a new account for each as of 1/7?
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ECC

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Posted 1 month ago

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Kris Williams

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I would just do a journal as at 30/6 and post the necessary adjustment to retained earnings, calculate the difference between your balance and the bank statement balance
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Kris Williams

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Yes ABS correct, opening balance equity
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Kris Williams

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Yep you definitely need to investigate the impact of GST as per ABS’ s advice. If those transactions included GST it will be a bigger job.
Hi Eastside

Please do not post to retained earnings!!!! If you must use opening balance equity.

How many years are we talking and how were you using these accounts i.e were you just entering the credit card transactions that related to the business only?  If yes then this is money you have technically paid yourself and should have been journaled to your loan account, and the credit card acct to bring it back to zero or were you paying the business amount off the credit card with a payment every month, bringing the credit card account back to zero?

With the tax account, if you had set one up to transfer money from the business to tax acoount and monies back this should be simple to reconcile if you have all the statements, did you pay the BAS out of the tax account or bring the money back into the business to pay the tax??
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ECC

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About 9 years, transactions have been entered into the tax account but the money coming out of the tax account has never been entered. The accountant just sorted that his end. 
So, the accountant has asked from now on to start reconciling it on my end - but I'm not sure how to start. I can't go back and enter all the transactions. 
Can I just make this account inactive on quickbooks and start fresh with a new account?
Hi ECC

Jnl entries can be done, my concern is what has been paid out of this tax account and if it ever got into your file, especially if the payments out were bas paid, this will mean that your gst collected/paid will be affected, which on cash basis can't be reconciled anyway, but it will also affect the PAYG account, which should be reconciled as well.

I have just cleaned up a MYOB file like this for a client, my biggest concern for you is if the same, there were multiple wrong accounts.  There was a 'tfer to BAS' (exp.acct) for when they transferred money from bus. to tax acct.  Another one to set up to pay the Bas from the tax account. 

If no complications go to reconcile the tax & credit card @30Jun18 (or 19) tick all then jnl the difference to opening bal. equity, reconcile.  Reconcile with the statements from 1Jul18 or 19 after this.

if you need help, email me:  Kim@kwikbooks.com.au
 
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Glenda Veale

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For me I would ask the accountant for journal entries at end of last financial year, 30.6.2019. Then make all July entries and reconcile from now on. Is it a tax bank account or the gst payable account you need to reconcile?