.png){kind=spacer}
QUESTION: I was looking for our May 31 trust account reconciliation so I could reconcile June, but am unable to find finalized reconciliation. It comes up with this error message. It is appears to be part of all of our trust reconciliations for April and May. Can you please explain?
Are all of our trust accounts are linked to one reconciliation? Why can't each trust GL account have it's own reconciliation?
RESPONSE: The message is saying that after you committed your April 30 bank reconciliation, a debit memo or journal entry modified your GL balance (these are not cheques, so they are no reconcilable items) causing you to unbalance your bank reconciliation. You need to uncommit your May bank reconciliation so can uncommit your April one to then adjust the bank reconciliation, so it balances. As a GL bank adjustment via debit memo or journal entry implies a response to a bank adjustment, you can complete the bank adjustment in the bank reconciliation form so once in balance you can recommit.
Please consider that this maybe a timing difference. It is possible that the debit memo or journal entry is temporary, and it will be reversed on the same date self correcting your bank reconciliation.
The bank reconciliation is in context of a physical bank account. It is the firm's decision if they want to have one or more GL accounts associated to one bank account. Every trust bank GL account must be associated to a physical bank account.
For example many firms create a GL account for "Retainer Funds in Trust" and a second GL account "Other Pooled Trust" GL Account to separate the trust receipts deposited in the one physical bank account for pooled trust. This makes it easier to control the use of funds to pay the firm's invoices versus the funds to be used in the transaction.
Once a physical bank account is associated to a GL account, and a transaction occurs, the relationship cannot change (see GL account properties). To make this type of change, you will need to create a new GL trust account, associated it to the physical bank account so that you can transfer the funds from the old one. Once the funds are transferred you can inactive the old one so no new transaction is added.