Sage Bank Reconciliation Discrepancy Fix

10-minute fixVerified for Sage 50Medium difficulty

Quick Answer:

Bank reconciliation discrepancies occur when your Sage records don't match your bank statement due to unrecorded transactions, timing differences, or clerical errors. Fix by identifying missing transactions, verifying bank fees, and correcting timing differences.

What is a Bank Reconciliation Discrepancy?

A bank reconciliation discrepancy in Sage occurs when the difference between your bank statement and Sage records is not zero after matching all transactions. This unresolved amount indicates missing or incorrectly recorded entries that need to be identified and corrected.

Error Reconciliation: Bank statement and Sage records don't match

Your reconciliation shows an unresolved difference between expected and actual balances.

Symptoms:
  • •Difference after matching is not zero
  • •Missing transactions in Sage
  • •Unrecorded bank fees or interest
  • •Journal entries affecting reconciled transactions
  • •Timing differences between deposits and clearances
Resolution Steps:
  1. 1.
    Review bank statement for unrecorded transactions
  2. 2.
    Check for missing bank fees and charges
  3. 3.
    Verify timing differences for recent deposits
  4. 4.
    Look for modified or deleted reconciled transactions
  5. 5.
    Create adjusting entries for discrepancies

Quick Fix for Reconciliation Discrepancy (10 Minutes)

Fastest Solution

  1. Note the exact discrepancy amount
  2. Search bank statement for that exact amount
  3. Check Sage for unrecorded bank fees or service charges
  4. Verify recent deposits haven't cleared yet (timing issue)
  5. Look for duplicate or missing entries
  6. Create bank adjustment entry if legitimate discrepancy found

Detailed Solution Steps

  • 1
    Identify Missing Transactions

    Start by systematically comparing your bank statement to Sage entries:

    1. Open Bank module in Sage and access Bank Reconciliation
    2. Print or view the reconciliation report
    3. Compare each bank statement line to Sage transactions
    4. Mark any bank items not appearing in Sage
    5. Note timing differences (deposits in transit, outstanding checks)
  • 2
    Check for Unrecorded Bank Fees

    Bank fees often go unrecorded and cause discrepancies:

    1. Review bank statement for service charges
    2. Look for overdraft fees, wire transfer fees, or monthly charges
    3. Check for interest payments (positive or negative)
    4. Record missing fees using Bank Payment in Sage
    5. Post to appropriate expense account (e.g., Bank Charges)
  • 3
    Verify Reconciliation Adjustments

    Check for journal entries or modifications affecting reconciled items:

    1. Go to Audit Trail or Transaction History
    2. Filter for bank account transactions in reconciliation period
    3. Look for journal entries, corrections, or deletions
    4. Verify if any reconciled transactions were modified
    5. Reverse or correct improper adjustments
  • 4
    Handle Timing Differences

    Distinguish between actual errors and timing issues:

    Common Timing Differences
    Deposits in Transit: Recorded in Sage, not yet on bank statement
    Outstanding Checks: Issued and recorded, not yet cleared
    Recent Deposits: Posted to Sage, bank shows next business day
    Electronic Transfers: May take 1-3 business days to clear

    These are normal and shouldn't be adjusted - they'll reconcile next period.

  • 5
    Create Reconciliation Adjustment

    If you've found a legitimate discrepancy that needs correction:

    1. Go to Bank module → Bank Accounts
    2. Select New Bank Payment or Receipt (depending on discrepancy type)
    3. Use "Reconciliation Adjustment" or "Bank Error Correction" as reference
    4. Post to Suspense Account or Bank Adjustments account
    5. Document the reason in the transaction notes
    6. Re-run reconciliation to verify balance matches

    • Why Do Reconciliation Discrepancies Occur?

    Common Causes

    • Unrecorded Bank Charges: Service fees, overdraft charges, or wire transfer fees not entered in Sage
    • Timing Differences: Transactions recorded in different periods between Sage and bank
    • Data Entry Errors: Transposed numbers, wrong amounts, or duplicate entries
    • Journal Entry Adjustments: Manual adjustments that modified reconciled transactions
    • Missing Transactions: Deposits or payments not recorded in Sage

    How to Prevent Reconciliation Discrepancies

    Best Practices:

    • Reconcile bank accounts monthly (or more frequently for high-volume accounts)
    • Use bank feeds to automatically import transactions and reduce manual entry errors
    • Record bank fees immediately when they appear on statements
    • Never modify or delete reconciled transactions without creating an adjusting entry
    • Review transaction history before reconciling to catch obvious errors

    Frequently Asked Questions

    What if I can't find the source of the discrepancy?

    If you've thoroughly checked and can't locate the issue, create a reconciliation adjustment entry to a Suspense Account. Document what you've checked, and revisit it in the next reconciliation period. The discrepancy may become clearer with time.

    Should I force the reconciliation to balance?

    Only as a last resort. Always try to find the actual cause of the discrepancy. If you must create an adjustment, use a Suspense or Bank Adjustments account and document thoroughly so you can investigate later.

    Can I reconcile if there's a timing difference?

    Yes. Timing differences (deposits in transit, outstanding checks) are normal. These shouldn't prevent reconciliation - they'll appear on your next period's reconciliation when they clear the bank.

    How do I prevent discrepancies when using bank feeds?

    Enable bank feeds in Sage to automatically import transactions, reducing manual entry errors. Always review imported transactions before accepting them, and ensure proper account mapping for different transaction types.

    Related Resources

    Bank Feeds Connection Error

    Fix bank feed import issues

    Phantom Receipt Matching

    Fix payment allocation errors

    Need Professional Help?

    If you're still experiencing reconciliation discrepancies after following these steps, or if you need help identifying complex accounting errors, our Sage experts are here to help.

    Get Expert Support