A common challenge with Dynamics GP (Great Plains) is keeping the checkbook balance in sync with the general ledger (G/L) balance of the matching g/l bank account.   This article will help you keep the checkbook balance equal to the general ledger balance.

Overview   

This issue happens a lot partly because users do NOT understand that the checkbook is a subledger of the general ledger in Dynamics GP.   So if you do any journal entry in the general ledger that affects a bank balance (i.e. the checkbook), you will cause the checkbook to be different than the general ledger balance.  That is the most common mistake that happens.

But this issue also happens because of a poor software design by Microsoft.    There exists a system control that is supposed to help you keep the checkbook balance equal to the general ledger balance, but it is an optional system control that people don’t know exists.   In the setup of your general ledger bank accounts (go to Financial > Cards >

How To Fix It

If you notice that your checkbook balance in Dynamics GP does NOT match your general ledger balance, here’s what to look for.

Ways to resolve it:

1)   Did you do any regular journal entries that affected the cash account?

       Use smartlist to look for this.

2)  Do you have any undeposited receipts?

      When a receipt is entered, it increases your general ledger bank account balance but the checkbook does NOT get increased until you enter the deposit.

3)  Are there transactions coming from other modules that are bypassing the checkbook?

      There can be a variety of things that are examples of this:

a)   We had a client that was creating a debit memo in the receivables module for customer payments that bounced (NSF checks).    So in the debit memo they were crediting the bank account g/l account.    However, the checkbook would not know about this kind of transaction.

b)   Did you book a transfer between 2 bank accounts but you didn’t use the Bank Transfer window?   If you do any kind of bank transaction (such as an increase or decrease adjustment), and you credit or debit another bank account in the g/l debits and credits, this will mess up your checkbook balance.    Because the checkbook for the other bank account involved will not know about the adjustment you did.   So all transfers between 2 bank accounts have to be done using the Bank Transfer window in Dynamics GP.

4)   Did someone enter a bank transaction and accidently change the g/l account?

When you start a bank transaction in Dynamics GP, and you pick a checkbook, the system then defaults the general ledger cash account to the general ledger cash account associated with that checkbook.    However, you can accidently override this general ledger account.   So, if you do a bank transaction, and then you change the account to the wrong account, we have noticed that the checkbook balance doesn’t get updated.   Of course, the general ledger is also wrong.   But so too will the checkbook balance.