16 Nov Deposit Data Entry Errors
Deposit Data Entry Errors
Q – My accountant just informed me that I have been doing my deposits all wrong. I had been entering an invoice to send to the customer then receiving the payment to show the invoice was paid. I looked in the check register and did not see the money, so I entered a deposit which agrees to the bank statement. Now I have a big mess because the income has been recorded twice (once from the invoice and once from the deposit). What can I do now to fix the problem?
A – There are two alternatives, depending on the volume of transactions. One is to “reconcile” the deposits as of specific dates, the other is to fix the detail.
The fastest solution is to make a deposit each month by checking off all the receive payments for the month. Then say OK to “pull” these transactions onto the deposit slip, then enter one line as a negative amount coded to the general ledger account where the previous deposits have been recorded. This will, in effect, reclassify the undeposited funds amount against the incorrectly recorded income.
The solution that will provide a clean trail of what has actually happened would be to “pull” the receive payments onto the deposit slips. This can be done by editing the deposit, click on the payments button at the top, place a check mark next to each receive payment that should be included for the deposit, say OK to return to the deposit slip, delete the incorrect detail line (note that the deposit amount should still be the same as when the process began). The disadvantage is that this process can be time consuming. However, if the deposit total does not change, it will not effect any of the bank reconciliation work already completed. That is the reason for changing the deposit as opposed to deleting it.
P.S. If the receive payment option had not been used (i.e. the invoices were entered and the deposits entered directly onto a deposit slip or into the register) and there was only one payment per deposit slip, the most efficient correction may be to change the general ledger account code to Accounts Receivable. This method would require the customer:job in the name column. If multiple payments were deposited together, one of the options above would be needed. A second step of “linking” the invoice to the credit/payment would be required through the receive payments form.