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What is bank reconciliation?

Bank reconciliation is the process of making sure the transactions in CloudFFL OS match what your bank says actually happened. Think of it as checking your homework — you recorded invoices, payments, and bills in the system, and now you're verifying that the money actually moved the way you expected.

Why it matters

Without reconciliation, problems hide. Common issues that reconciliation catches:

  • A customer payment you recorded but the bank hasn't received yet — maybe the check bounced or the wire didn't go through
  • Bank charges you didn't know about — monthly fees, wire transfer fees, chargeback fees
  • Duplicate payments — you paid a vendor twice by accident
  • Missing transactions — a POS settlement that didn't post, or a vendor debit you forgot to record
  • Fraud — unauthorized charges on your business account

If your books don't match your bank, your financial reports are wrong — which means your profit and loss, cash flow, and tax filings could all be off.

How it works in CloudFFL OS

The basic process:

  1. Get your bank transactions into the system — either by importing a bank statement file (CSV, OFX, QIF) or entering transactions manually.
  2. Match each bank line to existing records — CloudFFL OS looks at your invoices, payments, and bills, and suggests matches. You confirm the ones that are correct.
  3. Handle anything unmatched — bank fees, interest, or transactions you forgot to record get created as new entries.
  4. When everything matches — your bank balance in CloudFFL OS equals your actual bank balance. You're reconciled.

How often should you reconcile? At minimum, once a month when your bank statement arrives. Many dealers reconcile weekly — especially if you process a lot of card transactions through NMI or Authorize.net. The more frequently you reconcile, the easier each session is, because there are fewer transactions to match.

What you need before you start

  • Your bank statement — either a downloaded file (CSV or OFX format from your bank's website) or a paper statement you can reference
  • Your bank journal set up in CloudFFL OS (this is done during initial setup — see the System Setup book if you haven't configured it yet)
  • Invoices and bills confirmed and payments registered — the more you've recorded before reconciling, the more automatic matches you'll get

The next pages walk through importing your bank statement and matching transactions step by step.

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