Share this content

How to handle unmatched cash receipts in Xero?

Xero doesn't seem to let you book receipts until you know exactly which invoices are being settled

Didn't find your answer?

One of my clients using Xero has allowed a backlog of receipts to build up in the bank rec sitting in the "un-reconciled statement lines" section. The reasons for this being: 1/ owner hasn't had time to chase customers for what items they've paid; 2/ customers often don't advise which items they've paid when making payment.

So we know which customer has paid but we don't know which invoices. But in Xero I can't see any way to handle the receipt to make it "reconciled" in the bank statement and on the customer account as "unmatched cash". We could then contact the customer to sort it out while showing a reasonable (if technically unreconciled) receivables statement. Instead we have to supplement the customer statement with a second schedule of "oh we do know you paid us this much but not for what".

I'd prefer not to do it by using the "overpayment" feature because really it isn't an overpayment but that's the best idea I've had so far. I can't find any guidance in Xero docs. So I'm hoping AWeb can help.

Replies (6)

Please login or register to join the discussion.

By ireallyshouldknowthisbut
10th Dec 2021 14:22

Surely they are in the right place now? If you hide them away on the customer ledger the chances of resolution surely decline.

its where I would leave 'em until resolved and look very much as your systems here and why customers are not using invoice numbers in their payment reference like everyone else does.....ie is is really a sloppy billing issue by your client? If it was me I would ensure that there was some slight variation in the invoicing so it was always abundantly clear what was paid through simple maths. Back in the old days before you saw the customer's name on the bank whenI worked for a business with around 100 bills a month for the same sum, they got issued from £1000 down to £999.00, and by the pennies we could match 'em. Worked a treat. This was before DD was easily available which would of course now make this redundant as you simply bill out 100 * £1k and collect them automatically.

Solve the problem, dont solve the symptom.

Thanks (0)
Replying to ireallyshouldknowthisbut:
Routemaster image
By tom123
10th Dec 2021 15:03

One of my bugbears is systems that hold you back in reconciling the bank because of the need to sort other ledgers out - which of course involves trying to track the customer or supplier down. Really doesn't work if you have division of duties and your cash book person is not also your AR or AP person.

This is really poor design, and leads to banks not being reconciled.

Personally, I want everything on the customer and supplier ledgers for all to see, rather than elsewhere.

But, I accept it is probably a function of the size and types of departments I have operated compared to the usual size of a typical Aweb user's client.

Thanks (0)
Replying to ireallyshouldknowthisbut:
RLI
By lionofludesch
11th Dec 2021 11:10

ireallyshouldknowthisbut wrote:

its where I would leave 'em until resolved and look very much as your systems here and why customers are not using invoice numbers in their payment reference like everyone else does.....

It's the customer's fault ?

Thanks (0)
By Moonbeam
10th Dec 2021 16:05

Could you set up a debtor account in the balance sheet for unreconciled receipts? You could reconcile first to that account, then remove and redo when you know what invoice was paid. Whatever you do will be time-consuming, because you don't have the right info upfront.

Thanks (0)
avatar
By paulwakefield1
10th Dec 2021 19:13

We use the Overpayment option - misnamed and clumsy but the best of a limited range of options

Thanks (0)
Replying to paulwakefield1:
avatar
By Samantha20
11th Dec 2021 11:19

paulwakefield1 wrote:

We use the Overpayment option - misnamed and clumsy but the best of a limited range of options


Yes, this is what we do too.
Thanks (0)
Share this content