What do I do when money is received into my business bank account but the customer cannot be identified immediately?
No matter how well organised you are or how good your sales system is, there are occasionally times when money lands into your business bank account and your bookkeeper is unable to easily recognise who or where it came from.
What should you do when this happens?
How should you deal with this on Xero?
If you want to ensure your bank account is kept up to date on Xero and properly reconciled you will need to do something.
Here’s what one of our Xero specialists, Omer Khwaja, suggests how you tackle this particular situation in 6 easy steps.
Step 1. Create a new contact called “Unknown Customer”
Step 2. Post the bank receipt as a payment on account to Unknown Customer using the Find and Match feature in the bank reconciliation.
This will create a debtor in the Receivables Ledger with a negative balance. In the nominal ledger, the Accounts Receivable will be credited and the bank debited.
Step 3. When the money received is later identified, open the contact record for Unknown Customer and go to the payment on account in question. Select the drop down arrow at the right hand side of the transaction and select view.
Step 4. Select the Overpayment options at the top right and choose edit.
Step 5. Change the customer name from Unknown Customer to the correct customer. Select Update.
Step 6. Select Overpayment options again at the top right and choose Allocate Credit to match the payment to the invoice(s).
That should do the trick for you.
If it doesn’t, or you are encountering any other practical difficulties with Xero, feel free to contact Omer at firstname.lastname@example.org or please telephone him on 01925 761600. He will be very glad to help you.