Playbooks

Reconcile your Xero bank feed faster

Clear your Xero Reconcile tab in one weekly sitting, with bank rules doing the repeat work for you.

The "Items to reconcile" count on your Xero dashboard keeps climbing, and every week you click OK on the same suggested matches and re-code the same transactions by hand. This playbook gives you a simple weekly routine inside Xero, plus a prompt to work out which bank rules will save you the most clicks.

The steps.

Step 1. In Xero, open Accounting, Bank accounts and click Reconcile items on the bank account you want to clear.

Step 2. On the Reconcile tab, work top to bottom. Where Xero shows a green suggested match (a bill, invoice or transfer), check the amount and date, then click OK.

Step 3. No suggestion? Use Find and Match to match one statement line to several invoices or bills, or to a part payment.

Step 4. For lines with no matching transaction, use the Create tab to add a spend or receive money transaction, picking the account and tax rate.

Step 5. For lots of similar small lines (bank fees, fuel, subscriptions), use Cash coding to code them in one go.

Step 6. Open Manage account, Bank rules and turn your repeat payees into bank rules. The prompt below helps you decide which ones are worth a rule.

Step 7. Before you finish, run the Bank reconciliation summary report to check Xero's statement balance matches your real bank balance.

Here is the prompt to copy and paste. I use Xero. Here is an export of my unreconciled Xero bank statement lines. For each line, suggest the Xero account code from my chart of accounts and the Xero tax rate (for example GST on Expenses, GST Free Expenses, BAS Excluded). Then list which payees I should set up as Xero bank rules, with the rule conditions (contains text, amount) and the account and tax rate to allocate. Mark anything you're unsure about for my bookkeeper.

Before you click OK.

Only accept a Xero suggested match after checking the amount, date and contact. Test new bank rules on the first few matches. Your agent can get account codes and tax rates wrong, so check them against your chart of accounts and confirm GST treatment with the ATO or your accountant. This is general information, not advice.

Let Xero's bank rules do the repeat work, and reconciling becomes a quick weekly check instead of a monthly catch-up.

Using MYOB? A MYOB version is coming.