Guides · Reconciliation
Why a bank reconciliation fails: ten causes and the trail each one leaves.
A reconciliation that won't close leaves clues in the size of the gap, its sign, whether it repeats and the month it first appeared. This reference maps each clue to the record that confirms it and the correction that resolves it, so you can work from the number back to the transaction behind it.
A diagnostic reference, written for owners and in-house bookkeepers. The walkthrough of the reconcile screens themselves is a separate guide.
Quick answer
Read the difference before changing a single entry: its size, which side is higher, and whether last month showed it too. Those three facts narrow ten suspects to two or three. If it divides evenly by 9, look for swapped digits; if it equals the month's processor fees, a payout was booked gross instead of net.
Here from a symptom? The page on a bank account that refuses to reconcile starts from what you're seeing. Want it traced for you? That's account reconciliation, our service page.
Read it first
Four clues hidden in the difference itself.
The number a reconciliation leaves behind looks like a verdict, but it is closer to a fingerprint. Before opening a single transaction, write down four things about it. Together they rule out several of the exceptions below and tell you which month to open first.
Work with one account and one month at a time. A gap that mixes two months, or two accounts joined by a transfer, can fit none of the patterns until it is split apart.
Its size
Does it equal one transaction, exactly twice one, the month's fees, or a figure that divides by 9? Each of those points somewhere different.
Which side is higher
Books above the bank means money in was overstated or money out was missed: a duplicate deposit, an unrecorded fee. Bank above books is the mirror image: a duplicate payment, unrecorded interest.
Whether it repeats
The same amount carried from last month means the break is behind you, in a period already reconciled. A new amount means this month's activity.
The first month it appeared
Every later month inherits the break, so the search starts at the earliest month that fails, not at the month someone noticed.
Fault tree
From one stubborn number to the transaction behind it.
Read it top to bottom. The first split separates old breaks from new ones; the tests on the right sort a new gap by its size.
Exception library
Ten exceptions: what you see, what to check, how it resolves.
Each row starts from what shows up in the reconciliation or on the statement, names the record that confirms or rules it out, and ends with the correction.
| Exception | What you see | What to check | How it resolves |
|---|---|---|---|
| Duplicate: feed plus manual entry | The gap equals one transaction, and the same payee and amount show up twice within a few days. | Search the register for that exact figure. One copy is linked to a bank-feed line; the other was keyed by hand before the feed caught up. | Keep the copy tied to an invoice or bill, if either is; otherwise keep the feed-matched one. Remove the other and re-reconcile from the month it sits in. |
| One-sided transfer | The gap matches a move between two of your own accounts, and the paired account is off by the same amount the other way, or income or expenses look inflated by it. | The other account's register on the same date. A transfer booked as a deposit on one side and an expense on the other is still one-sided. | Record it once, as a transfer between the two balance-sheet accounts, and strip out any income or expense coding. Both accounts then tie out. |
| Entry in the wrong direction | The gap is exactly twice one transaction. | Find a transaction for half the difference and compare its direction with the statement: a refund posted as a charge, a deposit posted as a payment. | Change the transaction's type instead of posting a correction beside it; both halves of the error cancel at once. |
| Transposed digits | The gap divides by 9 with nothing left over. The quotient hints at the position: 1 to 9 suggests the ones and tens places, a round ten up to 90 the tens and hundreds. | Scan the month for amounts built from the same numerals in a different order, and compare each against its statement line. | Correct the figure to the statement. If it was copied from an invoice or bill, correct that document too, or the error returns in receivables or payables. |
| Feed gap or re-import | A run of statement lines is missing from the books over a stretch of dates, or a block of identical transactions appears after a feed was reconnected. | Compare the earliest and latest feed dates with the statement period, then sort the register by date and look for clusters that repeat. | Enter or import the missing stretch from the statement, exclude the re-imported copies, and note the reconnection date for next month. |
| Reconciled line edited or deleted | Last month tied out, but this month's beginning balance no longer equals the last statement's ending balance. | Compare the saved reconciliation report for that month with the register as it stands today; the change log shows who altered what, and when. | Restore the line to what the statement shows. If the change was a genuine correction, reopen that month, redo it and write down why. |
| Opening balance mismatch | The account hasn't tied to a statement since it was set up, and the gap holds steady from the first month on. | The opening entry against the statement balance on the day the books begin, and against the balance sheet in the last filed return. | Correct the opening figure to the statement. When the offset touches a year already filed, agree it with your CPA before posting. |
| Timing items | The gap equals checks written but not yet cashed, or a deposit made on the last day of the period. | Next month's statement. Items that clear there were timing, not errors. | Nothing to correct: list them on the bank side as outstanding. A check still uncashed months later is worth a call to the payee. |
| Bank fees, interest or a returned check not recorded | Small gaps that can repeat from month to month. Service charges and a bounced customer check leave the bank below the books; interest leaves it above. | The fee, interest and returned-item lines on the statement against the books for the same month. | Record each one: charges to expense, interest to income, and a returned check back against the customer's balance. A bank rule codes the regular ones from then on. |
| Processor payout booked gross | The books show a bigger deposit than the bank by the fees or refunds withheld. Or the bank ties, but sales read low and the platform's own report doesn't match the books. | The payout report for that date: gross sales, fees, refunds, chargebacks and any reserve held back. | Record each settlement as gross sales less fees and refunds, so the pieces add up to the deposit. A clearing account per platform keeps every settlement visible. |
One more belongs beside the edited lines: a transaction ticked as cleared that isn't on the statement. The reconciliation balances against a figure no statement shows, and next month's beginning balance gives it away.
Figure data as a table
| Account | Debit | Credit | The exception it clears |
|---|---|---|---|
| Bank service charges | 38.00 | — | A fee on the statement the books hadn't caught |
| Checking | — | 38.00 | — |
| Checking | 12.46 | — | Interest the bank paid |
| Interest income | — | 12.46 | — |
| Accounts receivable | 640.00 | — | A customer's check returned unpaid |
| Checking | — | 640.00 | — |
| Card processing fees | 87.30 | — | A payout that was booked at the sales amount |
| Checking | — | 87.30 | The deposit comes down to what the bank received |
| Deposit in transit | — | — | No entry: listed on the bank side, clears next month |
| Totals | 777.76 | 777.76 | Adjusted book and bank balances now agree |
Two columns
Bank side or book side: where each correction goes.
A reconciliation report has two columns, and every exception belongs in one of them. Putting a correction in the wrong column is how a month that was fixed comes undone the next.
Listed, not posted
Deposits in transit, checks not yet cashed, and the occasional mistake by the bank itself. They adjust the statement balance on the report and nothing goes into the ledger. Timing items clear on their own; a bank error is taken up with the bank.
Corrected in the ledger
Fees, interest and returned checks the books haven't caught up with, plus the errors in the table above: copies, transpositions, reversed directions, half-recorded transfers, settlements booked gross. Each gets a correcting transaction, dated in the period it belongs to.
When the adjusted bank balance and the adjusted book balance match, that month is reconciled. If they still don't, an exception is sitting in the wrong column or hasn't been found yet.
Worked example
Tracing a difference that divides evenly by 9.
One account, one month, one error, followed through the clues and the tree until nothing is left over.
Illustrative example — not client data. Assumptions stated.
- A single checking account and a single month; every figure is invented.
- Last month's reconciliation was right and nothing in it has changed since.
- No checks outstanding and no deposits in transit at month-end, so the statement and the cleared book balance should agree exactly.
- Only one error is present. Two errors can combine into a difference that fits none of the tests; split it and test again.
Write down the clues
The statement ends at $18,240.55 and the cleared balance in the books is $18,150.55, so the books are $90.00 below the bank. Last month closed at $0.00, so the break is in this month.
Test one and twice one
A search for $90.00 finds nothing in the books or on the statement, and neither does a search for $45.00. No duplicate, no missing line, no reversed entry.
Divide by 9
$90.00 divided by 9 is 10, a round ten: a swap between the tens and hundreds places, one apart, such as 450 keyed for 540.
Use the side
Books below the bank means money in was recorded short, or money out recorded long. The deposit list shows a customer payment of $550.00 on the 14th; the statement shows $540.00 that day.
Correct it at the source
Change the payment to $540.00, which also puts the customer's account right. The gap closes to $0.00 without any adjusting entry.
False zeros
When a zero difference still hides an error.
A balanced reconciliation proves the totals match. It doesn't prove each line is right, and three situations produce a zero that proves very little.
Two mistakes that cancel
A duplicate and a missing entry of similar size net to nothing. The bank total agrees while two transactions are wrong, and the damage surfaces in a category or a customer's account instead.
Lines cleared by hand
Marking lines cleared until the screen agrees, without each one appearing on the statement, forces a zero. The following month opens on a figure no statement supports.
The right account, the wrong cut-off
A credit card reconciled to month-end rather than its own closing date, or to another account's statement, can come out even by accident and prove nothing.
The fourth false zero is the balancing adjustment, and our account reconciliation page explains why we treat an existing one as a clue rather than a fix.
Diagnose or delegate
Signs the trail is longer than one sitting.
A single recent month with one clean clue is a fair job to do yourself; the tree and the table above cover it. Stuck on the screens themselves? How to reconcile in QuickBooks Online walks through them.
The situations on the right mean several months, or several accounts, have to be retied in order. That is the work our account reconciliation service does, for one fixed fee, scoped in writing.
The gap moves when you look again
If it changes between attempts, transactions are still being added or edited underneath you.
More than one account is off
When two accounts disagree at once, check the transfers between them first, because a transfer booked on one side only throws both off — so work the two accounts together.
The break sits in a filed year
A correction that reaches a period your CPA has already filed needs their view before it is posted.
It hasn't agreed since setup
An account that has not tied out since its first month needs its opening balance proven before anything after it can be.
FAQ · Updated October 2026
What people ask while chasing a difference.
What reconciliation proves in the first place is in the bank reconciliation glossary entry. Keeping accounts tied out every month is part of monthly bookkeeping; more reading in guides for the rest of the file.