QBO Chequing Reconciliation — Post-Migration Opening Balance

Outcome: all 13 FY26 months (2025-06 → 2026-06) reconciled. The $105.76 “discrepancy” never existed. Nothing in QBO was broken and no correcting entry was posted.

What was actually wrong

An off-by-one-month premise, not a data defect. The working assumption was “everything is reconciled to 2025-05-31.” QB Desktop 2017 reported 1050 · Cash and Bank:1080 last reconciled 06/30/2025, with a next-statement beginning balance of $10,178.50 — identical to what QBO derived.

So June 2025 was already reconciled, in both systems, correctly. Hours were spent trying to reconcile a month that was done, against a beginning balance that legitimately sat one month further forward than expected.

$105.76 was simply June’s own net change: 10,284.26 − 213.27 + 107.51 = 10,178.50.

The mechanic that explains every symptom

QBO’s reconcile “Beginning Balance” is derived, not stored. It is the sum of every transaction in the account currently flagged R. It cannot be edited directly.

This explains all of it:

• Toggling an old straggler’s reconcile status “changed the beginning balance” because it changed the membership of the R set — nothing was corrected, a different set was summed.
• QBO’s advice against a journal entry was correct: a JE changes the account’s balance while leaving the wrong R flags in place, so the discrepancy resurfaces at every future reconcile and the offsetting side sits permanently on the T2 balance sheet.

The diagnostic rule this yields — two diseases, opposite treatments:

	Balance wrong	Flags wrong
Symptom	Register balance ≠ real statement balance	Register balance correct; R set wrong
Fix	An entry (what the CC anchor JE legitimately did)	Fix the flags — never an entry
Wrong fix does	—	Makes a correct balance incorrect, misstates the balance sheet

Ticking a reconcile checkbox changes no account balance. It is metadata: zero P&L, zero HST, no restatement of a filed period. Flag edits are safe; entries are not.

Gotcha worth remembering: Desktop’s reconcile-time Service Charge

QB Desktop enters the monthly bank fee as a Service Charge on the Begin Reconciliation dialog — a field QBO does not have. No standalone transaction is ever created for it. After migration, those fees are simply absent from QBO’s register.

Symptom: each month’s QBO reconcile comes up short by exactly that month’s bank fees. Fix: enter them as a real expense (5701 Bank Fees:Bank Service Charges, Exempt), dated the statement’s fee date.

Sum each month’s fee rows into one combined entry — June 2025 was $6.20 ($6.00 Plan Fee + $0.20 Deposit Contents fee), July was $6.00 (Plan Fee only). Assuming a flat $6.00 every month leaves small residuals that look like new mysteries.

This was predicted from QBO’s register before the July reconcile was run (difference would be exactly $6.00), then independently corroborated by Desktop’s own dialog showing Service Charge −6.00.

FY26 reconcile ladder — BMO Business Account #04671011-251

Extracted from the statement PDFs in D:\FSS\Accounting\Statements\Chequing\ and double-gated: each row’s own arithmetic (opening − debits + credits = closing) and the month-to-month chain (each closing = next opening). 26/26 gates pass.

Statement ending	Opening	Debits	Credits	Ending balance
2025-06-30	10,284.26	213.27	107.51	10,178.50
2025-07-31	10,178.50	141.57	1.31	10,038.24
2025-08-29	10,038.24	167.50	1,118.81	10,989.55
2025-09-29	10,989.55	583.91	0.00	10,405.64
2025-10-31	10,405.64	7,492.35	10,000.88	12,914.17
2025-11-28	12,914.17	464.03	0.00	12,450.14
2025-12-31	12,450.14	558.88	0.00	11,891.26
2026-01-30	11,891.26	48.87	0.33	11,842.72
2026-02-27	11,842.72	125.27	0.00	11,717.45
2026-03-31	11,717.45	562.89	7.03	11,161.59
2026-04-30	11,161.59	202.50	0.01	10,959.10
2026-05-29	10,959.10	280.15	0.00	10,678.95
2026-06-30	10,678.95	247.45	0.48	10,431.98

⚠️ Use BMO’s real cycle end dates, not month-ends — 08-29, 09-29, 11-28, 01-30, 02-27, 05-29. Entering 08-31 instead of 08-29 pulls in transactions the statement doesn’t cover.

Warnings carried forward

• QB Desktop 2017 is read-only reference from here on. Never click Reconcile Now in it — that would create a second, conflicting record of a month QBO already owns. Its data stops mid-July 2025, so its own reconcile screens show large phantom differences (−134.26 for July = the missing Jul 29 $1.31 deposit plus an unmarked $135.57). Those are Desktop’s gaps, not QBO’s.
• EasyStart has no Undo Reconciliation and no Reconciliation Discrepancy report. Finishing a reconcile is effectively one-way. Verify the month’s line items against the statement before clicking Finish. Inviting the accountant as an Accountant user unlocks bulk Undo if it’s ever needed.
• “Close without saving” on an open reconcile is safe when nothing was ticked — it resets only what changed inside that session and discards typed statement info. Pre-existing R flags predate the session and survive.
• Four 2022 straggler transactions in 1080 are two offsetting pairs (±66.25, ±71.28) netting $0.00. They can never move any balance; ticking them is cosmetic cleanup only.

Open item (not blocking)

The credit-card anchor JE (Journal no. 2, 2025-06-01: debit 2106 / credit 3565 Opening Bal Equity, $90.39) was built on the same off-by-one premise — its memo reads “set 2106 to match May 25 statement carryforward.” If Desktop shows 2106 last-reconciled through 06/25/2025, the anchor may not have been needed, leaving $90.39 unexplained in Opening Balance Equity on the balance sheet the accountant reads for T2.

Talbot marked this “not needed” at closure — all 12 CC months reconciled to zero, which is evidence the anchor was about right. Revisit only if the accountant queries the OBE balance during T2.

Process note

The wrong answer was reached twice before the right one, both times by reasoning from Talbot’s stated premise instead of verifying it at the source. The register-subset test drafted in round 1 searched only items dated ≤ 2025-05-31 and structurally could not find a post-May cause; it produced a false “post a correcting entry” branch that had to be retracted. The premise itself was the bug — and the still-running QB Desktop install answered it in one dialog.