Reconcile Bulk Payments Received from a Payment Provider Using a Clearing Account

Contents

• Billing automation in OfficeRnD
• Reconcile bulk payments received from a Payment Provider
• How to create a Clearing account? 

Billing automation in OfficeRnD

To make the most of the billing automation in OfficeRnD, we advise connecting OfficeRnD to an external accounting system and a payment gateway. Learn more about the options here: 

• Accounting integrations
• Payment gateway integrations 

This enables a smoother billing operation where members can be automatically invoiced and charged. The invoices will be synced with the accounting system and their payment status will be automatically updated when the payment transaction completes. 

In this article, we'll show you one possible approach of reconciling payments in Xero or QuickBooks when the payments are initiated from OfficeRnD. However, we recommend discussing this with your accountant/bookkeeper to find out the best method for your organization. 

Reconcile bulk payments received from a Payment Provider

When you connect OfficeRnD to a payment gateway, charges will be collected and transferred to your bank account in bulk transactions. Each transaction includes payments of multiple invoices and excludes the processing fees. This makes the reconciliation process slightly more complicated. 

One approach to reconciling the transactions is to open Stripe, OfficeRnD, and the accounting system side-by-side and review the payments date by date to match them. An alternative solution is to use a clearing account.

How to create a Clearing account? 

A clearing account enables you to match both sides of the transaction - the payment recorded by OfficeRnD and the amount transferred to your bank account by the payment gateway.

Step 1: Create a Clearing Account

A Clearing Account is used to move money from one account to another when they cannot be moved directly. This account normally has a balance of $0.00 because you always take out the same amount that you put in. It may also be called a Barter or Wash Account.

• Learn how to create a clearing account in Xero.
• Learn how to create a clearing account in QuickBooks. 

Step 2: Configure the Accounting Integration Settings in OfficeRnD to Allocate the Payment Records to the Clearing Account

When OfficeRnD initiates a succesful payment transaction, the system creates a payment record in Xero/QuickBooks. The payment record is allocated to a payment account per the Payment Account mappings in the integration settings. 

When you use a clearing account, make sure to map the Payment Integration payment operations to the clearing account prior to integrating OfficeRnD with Xero/QuickBooks. This way, OfficeRnD will automatically record the payment charges in the clearing account.

For example, when integrating Stripe and Xero, you can create a clearing account in Xero and name it Stripe Clearing Account. Here is how to map the Stripe payments to the clearing account when configuring the Xero integration:

Step 3: Reconcile your bank account

When the bulk receipt from the payment processor appears on your bank reconciliation in Xero or QuickBooks Online, move it to your clearing account. 

Step 4: Check the balance in your clearing account

From time to time, check the transactions in your clearing account. The total of payments applied to your customer invoices on a particular day should match the bulk receipt you transferred in your bank reconciliation. Any remaining balance in the account will be usually customer invoices where you haven't received the payment in your bank account yet.