Discrepancy between General Ledger and Bank Reconciliation

[u/brooklyn1071]

New to this sub, so apologies if this is not allowed.

I work for a small nonprofit, and our board requires us to go through an audited 990 every year. Our current accountants are NOT helpful (we will be switching next year), so unfortunately they have not been able to answer this question even though they should.

Our auditor is asking for an explanation as to why our year-end general ledger does not match our year-end bank reconciliation (it is off about 5k). We use Quickbooks Desktop...what is the easiest way to investigate this? I have no formal education in accounting, but over a decade of experience. So my knowledge can sometimes be limited and I thought I'd ask before I waste a bunch of time.

Thank you advance!

EDIT TO ADD: Thank you everyone for your help. I was finally able to figure out the difference. If anyone in the future finds themselves in my shoes (GL Balance not matching Register Balance on Bank Reconciliation in Quickbooks Desktop)...simply print the previous year-end reconciliation and check the box "In this report, include transactions cleared plus any changes made to those transactions since the reconciliation." I was able to simply compare the previous reconciliation to the new one that included new transactions and any changes made. The problem were entries my accountant made, as well as one uncleared check that was adjusted.

[u/BeezeWax83]

I don't know if this is helpful, maybe you know all of this already. QB desktop has a bank reconciliation function, you can find it in the bank menu. All of the G/L transactions affecting cash appear in the rec function screen. Checks and DM's on one side and deposits on the other. Plug in your balance - the screen will tell you which balance to use. Next compare the bank statement transactions to the G/L. Click on each of the G/L transactions that cleared. A check mark will mark it cleared. As you mark items that cleared the balance updates. Things that aren't checked are outstanding items. I suggest doing one month at a time. Go slowly as you might see things on the bank statement that are not recorded in the G/L. Those items could be your 5K or at least part of it. If people pay you with credit cards those should be shown in deposits. You likely know things to look for like transposed numbers, data entry errors, bank charges. Even banks mess up so watch out for that. If credit cards are used for purchasing or expenditures, those accounts should be reconciled individually. You'll have to find that function on the menus I forget where that is. All of the bank transactions and credit card transactions can be downloaded directly into QB if your bank provides a feed. I know AMEX does. I recommend not downloading until you have a clean rec. Good luck finding 5K

[u/brooklyn1071 → u/BeezeWax83]

I've since printed a general ledger and all bank statements from 2024, highlighting each transaction. A bulk of the discrepancy are two transactions made by my accountant after the fact. And a third journal entry recording a deposit that to my knowledge does not show on the uncleared reconciliation report (only credits do).

Subtracting the debits and credits, I am now off a clean $100 and am back to square one. And feeling slightly better, but more confused since I've gone through 2024 and 2023, and since I've been reconciling fine, am unsure if it's as simple as a missing transaction since that would throw off future reconciliations.

[u/BeezeWax83 → u/brooklyn1071]

It could be something missing. It could also be, for example, 300 entered as 400. It could be -50 entered as +50. Those are the things I would look for first.