Bankbook

Why use The Bankbook?

Firstly the Bankbooks provide you with up-to-the-minute statements for each of your bank accounts. In comparison, real life bank statements are only issued every few weeks or so, and are always a couple of days out-of-date.

Secondly, provided you’ve fully reconciled your Cashbook and all of your computer’s Bankbooks exactly match your real life statements, then you know that your computer system’s accounts must be basically correct.

In this event the only mistakes that could still be left would be for un-reconciled entries in the Sales Ledger and Purchase Ledgers, typically caused by the same invoice being entered twice, which is quite common on multi-user systems. These can be spotted very easily. Just go to each Ledger, filter it (via its “signpost” button) to show un-reconciled items only and then sort by date (via its “Binoculars” button). Go to the start of the list and check all old un-reconciled items. Are they really bad debts (i.e. seriously overdue) or are they mistaken entries? If mistaken then delete them with the yellow “Bin” button. Your accounts will now be 100% correct.

Multiple Bank Accounts

To set-up multiple bank accounts, see “Set-up Bank Accounts”. To check your various different bank accounts, starting from the “Accounts Menu”…

· Click the “Bank” button

· Click the “Signpost” button

· Click “Select bank account”

· Click the account you wish to view

· Click the “OK” button

Creating Bankbook Entries

Money is posted from the Cashbook to the Bankbook/s via the Cashbook’s “Signpost” button option to “Cash-up to bank/s” (see “Cashbook, Cash-up to Bank & Symbols”). This procedure is equivalent to you walking to your real life bank with your pay-in book. All Cashbook receipts not already banked get cashed-up together as a single grouped “Receipts” item, while all payments get cashed-up individually. The cash-up date is not that important, as you will probably have to change most of the dates in your Bankbook in order to match them with your real life bank statement, as discussed below.

Bank Statement Reconciliation

Periodically you’ll receive a statement of your real life bank account, which you ought to align exactly with your computer’s Bankbook.

To do this you must have first set-up the Bankbook’s opening balance as described in the section below. Having established your opening balance, you should then ensure all the transactions following it are for precisely the correct amount, and in the same sequence, so that the running-balance on the far right remains penny perfect.

Marking Correct Entries

Where a computer bankbook entry matches the real life statement click the column to the right of the Date to “tick” the transaction. Your entire Bankbook should be ticked like this, up to the last item on your real life bank statement, as illustrated above. To remove a tick you simply click it a second time (i.e. the tick toggles on or off, when clicked).

Editing Bank Entries

To edit the date or wording of a Bankbook entry simply double-click it. Changing the date will also cause it to re-position itself accordingly.

Checking Grouped Receipts

You can check which Cashbook items are included in a grouped “Receipt” line, as shown below, by highlighting the “Receipt” in question and then…

· Click the “Signpost” button

· Click the option to “View entry details”

· Click the “Exit” button when done to return to the Bankbook

Re-sequencing Bankbook Entries

Where sums are correct but appear in the wrong sequence, typically because there is more than one on the same date, they may be re-arranged to match your real life bank statement. You simply highlight the wrongly positioned entry, select the “Signpost” option to “Relocate entry”, then double-click the line before which it should be re-positioned.

Deleting Bankbook Entries

See “Bankbook, Deleting Entries”.

Opening Bank Balances

You must start each bank account with an opening balance. To do this you create a Journal entry, like the example below (n.b. from the “Accounts Menu” click “Journals” then “New”). Note that a positive opening bank balance should be entered as a Debit. Also note that the “Make cashbook entry” tick-box on the journal should be left blank, unless you consciously want to record the cheque, or whatever was used to create the opening balance. If the cause of the opening balance was not due to a single payment, or initial share capital, but rather to your bank’s position after a period of trading, from where you’re now wanting to start your accounts, then the matching account should be the “Profit & Loss (brought forward)” control. Otherwise use a control account like “Share Capital” or “Director’s Loan”.

Bank Transfers

The transfer of funds from one bank account to another is done via a single Journal entry. Note that the “Make cashbook entry” tick-boxes on the journal should be left blank, unless you consciously want to record the cheques, or whatever means were used to transfer the funds. Also note that the Debit entry applies to the bank receiving the money, which many people find confusing.

If you deal with General Insurance, see also “Accounts, Period End, Transferable”.