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Overview

Your bank account is the heart of your business. Keeping up with the movement of money in and out of your bank account is crucial. You can maintain a record of all your bank transactions within Zoho Books. Would that mean, making an entry every time you transact? Worry not! You can either:

  • Set up Zoho Books to receive feeds of your transactions automatically Or,
  • Import your bank statements into Zoho Books periodically manually

It doesn't stop there, you can match the transactions from your statements and feeds to transactions that have already been recorded. When there isn't a match, Zoho books lets you add in that transaction. This page outlines the features of the banking module.

Bank Accounts

A bank account in Zoho Books is the virtual representation of your actual bank account. You can actually record a deposit, expense, fund transfer or pretty much perform every type of transaction that you would make in your normal bank account. So how does having this virtual bank account help you?

  • Maintain your bank account feature on your balance sheet.
  • The transactions that happen from your bank account affects your chart of accounts. If you weren't recording your banking transactions, you would need to post journal entries for those transactions, which isn't the modern day accounting practice that small businesses are turning to.
  • You can categorize the transactions that happen from your bank account. So you have more information at hand for each transaction than just mere debit and credit out of your bank account. Which is pretty much the only information that you can decipher out of a bank statement.
Banking Transactions

Zoho Books lets you record most transactions that you do on a day to day basis through simple forms. These transactions obviously involve your bank account, hence to record transactions you must get to the specific bank's account and select the type of transaction that you will be recording. Zoho Books being a double entry accounting system, it lets you select the accounts which will be debited and credited due to the transaction. For instance, if you are paying for a web campaign that you did, then you will debit the 'Advertising and Marketing' expense account while crediting your bank account; presuming you paid for the expense through your bank account.

Importing Bank Statements

As you keep recording transactions involving your bank and credit card accounts, you may at some time want to make sure that what's recorded in Zoho Books matches with your bank and credit card statements that you receive periodically. A simple import via a csv file should help you get your statements imported in. In this document we'll outline the steps for importing the statements, comparing it with the transactions in Zoho Books and recording transactions that haven't been recorded yet.

Setting Up Bank Feeds

The transactions in your bank account can be brought into Zoho Books automatically by setting up Zoho Books to receive automatic feeds from your bank. To do this, you'll need your online banking credentials and other information that you use for accessing your online banking account.

Reconciliation

The most volatile asset that you have is your bank account. Your bank account, being the core of your business, becomes inevitable for you to save your bank account from fraud and theft. One of the most easiest ways of identifying errors in your accounts is by going over your bank statements periodically and doing reconciliations regularly. Before you reconcile, you must set the closing balance which is the balance at the time of reconciliation. This is also the amount that you will be working towards. Understanding how a reconciliation process normally works is the first step to getting it done in Zoho Books.

  • Ensure that all the deposits appearing on the statement are in coordination with the desposits recorded in Zoho Books, with only the exception of deposits which are in transit at the time the statement was generated.
  • Make sure that all the disbursements mentioned on the statement have been entered into Zoho Books. Withdrawals are often missed out, because some disbursements like the service charges and other fees imposed by the bank are not known until you take a look at your bank's statements.

When you find transactions that are not recorded yet, add them in and check if you are able to arrive at the bank balance in your bank account in your virtual Zoho Books bank account too.

 

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