Before starting on the process part, let us first look into the relevance of the undeposited funds in QuickBooks. Undeposited funds account in QuickBooks is used to hold invoice payment and sales receipt you wish to combine.
It is a temporary virtual space for holding the payment till the time you do not have the deposit slip. Once you have your deposit slip then you can make a bank deposit in QuickBooks to match the undeposited funds.
The undeposited funds account is an internal ‘other current assets account’ that is created by QuickBooks itself. The feature helps in invoicing process by connecting receive payment and bank deposit feature in QuickBooks.
Now if there are a lot of old entries in your QuickBooks undeposited fund account, then you would like to clean up these entries, it is recommended that you apply the utmost care while doing this.
You should be clearing or deleting only those entries from the undeposited funds account in QuickBooks where the money has been deposited in the correct bank accounts and everything is reconciled.
In other, you should be deleting only those entries which are not required anymore. Now when we have a good understanding of the purpose of the undeposited fund account in QuickBooks, let us move ahead and look into the process steps of clearing or deleting the fund from the bank deposit in QuickBooks in the next section.
Steps to Clear or Delete the undeposited Funds from the Bank Deposit in QuickBooks
So, once you have decided to clear the undeposited funds’ account, you can follow the below steps to do so. But do ensure that you reconcile the data first because only those entries should be deleted which have been already assigned to the bank register. In other words, the entry which is already posted everywhere and is no longer required to be reflected in the undeposited funds’ account should be cleared out.
Steps to Reconciling the Data
Step 1. First of all, open the QuickBooks Online > click on settings and then click on Reconcile. You need to take out your Bank statement for performing reconciliation so keep it handy.
Step 2. In this step, choose the bank account, enter the start and end date from the statement and click Start reconciling. Now start matching or reconciling every entry from your bank statement to the corresponding item on the screen.
Step 3. Verify the balances by matching from the top once you are done with one-to-one transaction matching and click on Finish.
If you are able to reconcile the bank data successfully without any issue, then the transactions or entries left in the undeposited fund account are duplicate ones and need to be deleted. Let us see below the steps for doing so:
Steps to Clear out Undeposited Funds
Step 1. First of all, click open QuickBooks Online and click on the Plus icon and after that click on Bank deposit.
Step 2. Now go to the payment that is duplicate and needs to be deleted and click on the customer’s name to open the transaction.
Step 3. Now go to the bottom of the payment screen and click on More and then select delete to clear the entry.
We have also collated some FAQs for your quick reference purposes, let us look into those as well. They will clear the other doubts on related topics as well.
How can I remove the undeposited Fund altogether in QuickBooks?
Well, you can delete payments from the Undeposited funds by clicking open QuickBooks account and going to Lists > then Chart of Accounts > Undeposited fund > Amount. After that, you need to right-click on the amount and click on delete deposit.
What are the Process Steps to Change the undeposited Fund to Deposit in QuickBooks?
First of all, click on the plus button icon (+ icon) and choose Bank deposit. Now choose the account you wish to put money into in the Account dropdown menu and put the checkmark on boxes against each transaction and click on save and close.
What would be the Nature of the Undeposited Fund Account, in other words, will it have a Debit or Credit Balance?
It can have debit as well credit balance, whenever you have received the payment the balance will be debit in the undeposited fund account and when you make the deposit entry the undeposited fund account will be credit with the amount of deposit in the QuickBooks.
How can I fix the Negative Balance in the Undeposited Fund account in QuickBooks?
You can easily resolve the issues relating to negative transactions in an undeposited fund account by making a zero-value deposit and entering the negative value deposit in it. You can do so by clicking on the plus icon > select Bank deposit under other section > choose the payment and journal entry you created and make sure they are offsetting i.e., totaling to zero and click on save.
What are the steps of Reconciling the Deposits in QuickBooks?
First of all, open QuickBooks and find the deposit in the register, and double-click on the DEP line. Now delete the deposit line by clicking ctrl+del on your keyboard and choose the payment button from the top. After that put checkmarks next to the payment transactions that these deposits belong to, click on save, and close.
Can you list down the Process Steps to Delete the Duplicate Deposit in QuickBooks?
First of all, choose Banking from the top menu, and select Bank feeds and then bank feeds centre. Now click on the transaction list button, and look for the duplicate deposit and put a checkmark in the box to select it, now go to the action column and choose ignore. After that click on ‘Yes’ to delete the deposit.