QBO Tech Tip - Tie Out AR and AP Journal Entries
- All of my template workflows include details like this, and my Standard Operating Process Guides are start to finish standards for apps and internal processes.
There’s this little bookkeeping thing that drives me bonkers. Okay, there are more than a few little bookkeeping things that drive me bonkers, but in this case, it’s such an simple transaction to complete, and it will keep the QBO file neat and tidy.
I often notice in files that Journal Entries are done to clean up Accounts Payable and Accounts Receivable, but the Journal Entry has not been tied out to the transaction it’s intended to clear up. It’s an easy fix, so make it a best practice that when the AP/AR clearing JEs are done, the next task is to tie them out.
The Journal Entry will have the name associated with the entry - QBO does not allow you to create an AP or AR entry without one - so the tie-out will be quick and painless.
Accounts Payable:
Search for Vendor > Create Cheque (Check) > The JE and the original bill will both auto-fill in the screen > Amount will be zero > Choose payment account > Enter date > Save and close
Accounts Receivable:
Search for Customer > Create Payment > The JE and the original invoice will both auto-fill in the screen > Amount will be zero > Choose payment account > Enter date > Save and close
In both cases, if the off-setting entries don’t auto-fill in the payment screen, you can choose them both from the right-hand “drawer,” and then click them, toggle date and account.
You will usually notice the balance sitting in the AP/AR reports, but not always, so you may have a little investigation to undertake to find these rogue little buggers, and I have a cheat method for you.
Go to the bank feed >
Open an AP or AR transaction - any transaction is fine, as long as it is on the same side of the register as what you are hoping to ensure is clean >
Hit the “match” radio button on the left above the Vendor/Customer (“Find a match” is no longer in QBO)
Expand the date range back to what you are willing to clean up >
Filter by Journal entries
There really shouldn’t be any JEs sitting in there, so now you know what ones you need to check on and possibly tie out to the Customer or Vendor.
Good QBO housekeeping is important, so just as checking on non-posting transactions like open Billable items, POs and Estimates, it is good practice to make sure Accounts Payable and Accounts Receivable are cleaned up and tied out. And to ensure it gets done, tie them out as the JEs are created!
P.S. This tip works great if you have a low volume of open AR and AP JEs to complete. However, if your file is a hot housekeeping mess, you'll need to find an app to get that under control—that's a whole other can of worms I could write a blog in itself on!
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