Linda Artesani explains why QuickBooks Online won't truly delete a bank account with a balance. Instead, it creates a check to Opening Balance Equity to force the balance to zero, then marks the account inactive. Reconcile to zero first, or undo and exclude feed transactions, before inactivating.
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Hi there, Linda Artesani, QB Community Live and Artesani Bookkeeping. So I wanted to do a short video here. We haven't done many videos on the community forum, mostly because the community forum kind of became a hot mess. They took the old forum, merged it with the new forum, and kind of meshed them together. And meshed is a good word for it because it's kind of been messy and they've been working on it and they're cleaning it up, which is good. So we're— it looks like we're starting to get back to a more familiar community forum again. I did mention that because I wanted— and I want to add the link to this question in with the answer when I post it in our community, in QB Community Live on Facebook, because I want you to be able to get access to the forum. And if you're familiar with QuickBooks, maybe help out and answer some of the questions. So the question I found on Sunday was, can you delete a bank account even if it hasn't been reconciled yet? Does it need to be a zero balance? So really quickly on Sunday, I just wrote back and said, you know, honestly, I'd reconcile it, right? I would, especially if it's a bank account that you've maybe closed and moved on to another bank account, reconcile it to zero. Once you get the final statement, reconcile it to zero and then make it inactive. So it was weird today because I got a question on Facebook in a private group with the same question. It was an accountant that's familiar with desktop and moving using QuickBooks Online and I actually found the residual transaction from somebody who deleted a bank account that didn't have a zero balance. So I'm going to show you what that looks like. So let's come over to this bank account. So I'm just going to pretend that this bank account here is a bank account I didn't want on my books for whatever reason. Maybe I closed it to zero or whatever reason I don't want it here. So I just come over to the right and I hit Delete to get rid of it. And poof, it's gone. Simple, right? Oh, if only it was that simple. So what happened here is QuickBooks actually makes a transaction, and you can see why maybe somebody not familiar with QuickBooks Online— that was so easy, right? It was just literally 2 clicks and the bank account was gone, and you just assume it's gone, right? But it's not really gone because it's the internet and it's a web-based product. So when you think of the internet, it's forever. I think your mother was correct. It's a web-based product. There's a footprint, a digital footprint, right? It's always going to be there. So I wish Intuit didn't use the word delete here. I really wish it had the word inactive. So I'm going to go over to the gear. I'm going to include the inactive transactions so I can show you exactly what happened here. So here's my bank account and it's got, you know, in brackets it says deleted. Obviously it's deleted. It's not active. I can make it active again and bring it back. And let's look in the register to see what happened. So because I had a balance of $26,864.16, when I went over and just did the 2-click deletion, it made a transaction to automatic transaction by QuickBooks Online to account for the balance and to make it zero so it could be deleted. Now, what does that transaction look like? Well, in this particular one, because it had a bank balance, it had a positive balance. I'll show you what it did. It made a check to wipe out the balance and it posted it to opening balance equity account, which is an account that I clean up constantly. It's an account that should be zero. It's used to enter your balance sheet account when you start a brand new file. And if you're moving from another software or another, you know, starting a new file, your balance sheet gets entered. And then that account is like the balancing account till you're completely done. Once the balance sheet's in, it's balanced and it should be zero and this account will be zero. So now this person just deleted the bank account, real simple, click, click, it's gone. And this is what QuickBooks did to get rid of the balance. It just threw it into an account that's not proper. And really, you just need to get rid of this to bring the bank account back. The proper way to do this is to come in and reconcile it. Let's say you close the bank account. You started a new bank account with $26,864.16. Maybe you make a transfer to the new bank account. Whatever happened, if this bank account maybe you connected your bank account to the banking and you clicked and added a personal account when you didn't want that, then really the only way to get rid of that is to come in here and. Either delete it one by one, which you just click on it and hit delete. Or if it was done by the bank feed, you can actually go to the banking screen and pull up in QuickBooks and just delete all the transactions in QuickBooks. Just select them and hit undo, and that will populate them back into the for review screen. And then you can just select them here and then exclude them, and then that'll throw them in the excluded category, and then you can get them off. And then the trans— then the bank account will be zero and you can remove it. And basically when you remove it, you're going to delete it just like I did, but it will have a zero balance. And it's still— you'll still be able to bring it back. It'll just have the zero balance and no transactions. So that's it in a nutshell. Real short video, but hopefully that's helpful to you to understand what happens when you delete a chart of accounts account with a balance in QuickBooks Online. So remember, it says deleted, it really means inactive, and you really should— proper accounting practice would be to reconcile it to zero, then remove it off the books. So I hope that's helpful. And if you have any questions, comments, feel free to reach out to me or us on Facebook, QB Community Live. Hopefully that's helpful. And just seeing the visual sometimes is helpful, right? Thanks for watching. Bye.
