do you need to make sure that your vendor records are correct to the last detail well if that's the
case then you should watch this video reconciling with vendor statements if you have any questions
about this topic you can leave them in the comment section below and I'll do my best to help you and
of course if you feel the video helped you I hope you will click like and don't forget to subscribe
to get updates on new videos that come out all the time vendors send us a monthly statement to
declare what is owed to them as of the statement date if our vendor or accounts payable records
agree with the statement then we declare that our records are correct and have been verified by an
independent source if they do not agree with the vendor records we must reconcile with the vendor
until we determine the true and correct amount owed on each bill as of the vendors statement
date so what are the steps to reconciling with vendors well we compare the unpaid bills detail
report in quickbooks online with the related page on the vendors statement if you agree with
each individual unpaid bills open or unpaid amount as of the statement date then you're
finished congratulations your records match the vendor and everything is ok if you do not agree
you must compare each transaction since the last statement one by one with your vendor transaction
list to find and fix any differences and the best report in quickbooks online to do this
with is the transaction list by then let's take a look now we already have our report set up with
the transaction list by vendor but normally you would click standard and you would go down to
the vendor section which would be all the way down not who owes you because that would show
the balance you would go further expenses and vendors and you would get this one transaction
list by vendor ok I like to show the results of all dates regardless and what you would do we
you would go down to this vendor in question and you would read each transaction one by one on the
phone with the vendors bookkeeper until you find a money amount or a date or a transaction type
that's different whatever the different one is you would double click and open up and compare what
you see on your screen to what the vendor sees on their screen whoever made the mistake would
fix it now how do you know who made the mistake well if there is an attachment you could click
here and go back to the source document of the actual transaction so that you and your vendor
will look at the same document and determine who recorded the transaction properly and who made the
mistake whoever made the mistake simply fixes it and then after they fix it you would go back to
the unpaid bill report which we happen to have in the customize reports after you fix the mistake
go back and look at the unpaid bill report and see if it agrees with the vendor statement if it does
then you're finished if not you have to reopen the transaction list and keep reading one by one until
you find the difference now that procedure will fix every possible mistake you could have except
one very special mistake what if the total balance as of the statement date is in agreement with your
vendor but the balance of each individual unpaid bill on the statement was different in your vendor
records what specific mistake was made and more importantly how do you find it and how do you fix
it this special mistake that fits that condition is a Mis applied bill payment now a Mis applied
bill payment is the only challenging possible mistake that could be in the vendor and payable
records vendor total balances will be the same vendor transaction list will be the same vendors
running balance will even be the same the only indication of a Mis applied bill payment will be
different balances for each individual unpaid bill for example I mark your teacher miss applied one
of staples past payments and then they sent us a statement now ours our unpaid bill report with the
mistake looks like this but on the statement that they sent their list of remaining bill balances
looked like that now notice the total overall balance is the same but what do you notice is
different you probably notice for the middle bill seven six seven six we have one thousand ninety
five and they only have five hundred so ours is five hundred ninety five - hi you probably also
noticed that our bill number eight four eight four is 1055 but their's is one thousand six
hundred fifty so one of our bills is higher than their bills by five ninety five and another one of
our bills is lower than their bills by the same amount five ninety five so if one is higher and
the other is lower by the same amount that's a good indication that the specific mistake is in
is a miss applied bill payment so what are the steps to fixing a miss applied bill payment we
have to again open the transaction list by vendor we have to call the vendor on the phone we have
to read each bill payment to the vendor both you and the vendor have to double click and open up
each bill payment together and discuss how it was applied the person with the bill payment applied
wrong must fix it in their own computer and if it happens to be the vendor that's wrong after
they fix it they have to mail to us a corrected statement so in our records we double-click the
March 13th bill payment - staples and hours looked like this and when the vendor was going one by
one with us on the phone they opened their March 13th bill payment which staples and their March
13th bill payment and their records looked like that now you have the correct one I screwed up my
records but yours looks like there's where the bill payment was properly applied five hundred
ninety five dollars to bill number seven six seven six but we accidentally applied the March
13th bill payment to bill number eight four eight four so we now know that we are the wrong ones in
order to determine that we would have to go back to the check that we sent them and see how it
was supposed to be applied after a discussion with them we realized we were the ones who miss applied
the payment by looking at the source document so what do we need to do we need to uncheck the
wrong one and recheck the correct one move the checkmark to the right place reapply the payment
to the correct bill and after we do that our March 13th bill payments should look correct like this
and after we save it our unpaid bill report will then be correct and we will have the same
individual unpaid bill balances as our vendor and if we can handle that particular mistake we could
always guarantee that our vendor account payable records are always correct to the last detail