Common Discrepancies

Manual adjustments to the Chart of Accounts
Suspense Beginning Balances/Adjustments
Clear Owner Suspense
Receiving Payments
Programs
Division of Interest Transfer
Division of Interest Transfer (to a posted owner)
Posting a Revenue Run
Changing an owners interest from Net to JIB
Old Versions
Converted Suspense Balance

Manual adjustments to the Chart of Accounts - The suspense balance is stored in SherWare and it does not look at the balance in the respective account to determine what the balance should be. So if someone makes a journal entry to affect the suspense accounts and does not adjust the suspense accordingly then that will create a discrepancy in the reconciliation.

Suspense Beginning Balances/Adjustments - If you have adjusted an owner's suspense balance or entered a beginning suspense balance for an owner using this window it would not have posted the amount that you adjusted. You would have needed to make a journal entry for the same amount to the respective account in addition to adjusting the suspense balance here. SherWare does not post entries here because it does not know what account should be used as the off-set account. The suspense balance could be adjusted for a variety of reasons so we just don't post anything and assume that you are going to make a journal entry to affect the appropriate accounts. The window clearly states this in red writing at the top of it, so it should not be a surprise. If a journal entry was not made to coincide with the suspense adjustment then you will have a discrepancy in your reconciliation.

Clear Owner Suspense - You can clear an owner's suspense under the utilities menu with the clear owner suspense utility. If you do not mark the option to "create a check if balance is positive" then nothing will post. If this was done it would cause a discrepancy in your reconciliation unless you have made a journal entry to account for it. The suspense balance could have been cleared for a variety of reasons so we do not know what account should be used as the offset account. Therefore we do not post anything and have you make a journal entry so that the correct write off account gets used. This should not be a surprise because a warning message will appear stating this when a suspense balance is cleared and the posting was not made. If a check was created when the suspense was cleared then it would have correctly posted a clearing entry to the clearing accounts because it knows that the checking account is the desired offsetting account.

Receiving Payments - When you receive a payment on the receive owner net payments window it assumes that the owner has a deficit balance and will post the payment to the deficit account. This will be an issue if the owner is not in deficit. If the owner does not currently have a suspense balance and will not have a deficit suspense balance after the next run is closed then a discrepancy will be created. If the owner is on hold, the interest is on hold, or the owner is under the check minimum then the suspense balance is stored in the legal suspense account so the payment posting to the deficit account would be incorrect. You will need to find the transaction created by the payment in QuickBooks and edit the Credit to be the legal suspense account instead of the Deficit account. Accounting Manager users can make a journal entry to Debit the deficit account and Credit the legal suspense account.
If you do need to receive a payment from an owner that currently is not and will not be in deficit when the next run is closed then you can use the receive owner net payments window and then make a journal entry to correct the posting, or use the "Suspense Beginning Balances/Adjustments" window to receive the payment. The "Suspense Beginning Balances/Adjustments" window does not post anything so you would still have to make a journal entry with that method.

Programs - Programs will not cause a discrepancy but it may appear that you have one when reconciling. If you are using programs you have the additional option to track the suspense balance by program. This option is located on the program/partnership window where you setup each program. The option is titled "Net deficits with income outside of Program".

If the option IS marked then the suspense balances will be tracked the same as any other well that is not in a program so you do not need to take anything special into account. The reconciliation steps will be the same as the normal reconciliation listed above.

If the option is NOT marked then the owner's suspense balance within the program will stand on its own and will not be netted with suspense from other interests outside of the program. The only issue with this is that it makes the reconciliation a little more difficult. You can still easily audit the overall balance of the suspense against what posted to the respective accounts, but it will not be as easy to audit in detail by owner. This will not cause a discrepancy but may appear that you have one when doing a reconciliation.

The reason that it may appear as a discrepancy is that since each program individually holds a balance an owner may be getting a check while also in both legal suspense and deficit suspense in various programs. When the suspense entries are posted to QuickBooks the transactions that are posted are not associated with a program in QuickBooks. So you will not be able to easily identify the program each suspense transaction is from on the QuickBooks side.

In this situation the transactions will post to the suspense account in QuickBooks based on the owner's overall balance. So even though SherWare is tracking the balance of the programs individually it will post all of that owners suspense to QuickBooks based on the owners overall suspense balance. For example if the owner has $100 in legal suspense in one program and a $50 deficit in another program then the suspense for both programs will be posted into the legal suspense account.

Division of Interest Transfer - When you use the "Transfer Division of Interest between owners" utility to transfer interests with the option to "Include owner and suspense history" marked it will transfer the original owner's suspense balance to the new owner. Verify that the new owner either does not have a suspense balance, or if he does have a suspense balance that it is the same type (legal suspense or deficit) as the original owner did. If that is the situation then the transfer will not cause any discrepancies. If the new owner does have an existing suspense balance with a type (legal suspense or deficit) other than what the original owner had then you will need to make a journal entry to move the transferred balance from the original suspense account for the original owner's suspense type to the suspense account for the suspense type that the new owner currently holds.

Division of Interest Transfer (to a posted owner) - Posted owners are owners that post all income/expenses to income/expense accounts instead of having a check created. This is generally only done for your company's owner in the software so that you don't have to re-enter the statement that would have been created for them. Since everything posts directly to an income/expense account for these owners the system will skip the suspense processing for them. Because of this you should not transfer any suspense to a posted owner because it will end up being left in suspense permanently. You can transfer the interest, just do not mark the option to "Include owner and suspense history" if the original owner holds a suspense balance at the time of the transfer and the new owner posted owner. We suggest clearing the suspense balance for the original owner first, then transferring only the interest.
If you do want the history transferred to the new owner then you can go ahead and do the transfer and include owner and suspense history. It will let you do the transfer but a warning message will appear notifying you that no posting was made. You can use the clear owner suspense utility to clear out the suspense balance that was transferred so it isn't left hanging. You will have to then make a journal entry to remove the transferred amount from the suspense accounts and add them to the desired income/expense accounts. Since you are doing this for the history you will also need to add the suspense amount that were cleared back into the software on the owner history (Maintain menu) window so that it will be reported on the posted owners 1099.

Posting a Revenue Run - (DMIE only) Posting a revenue run will not cause any issues with the balances. I only mention it here because we occasionally have a support request where the accounts are not reconciling because the run had not been posted yet. It is a good idea to post the revenue run before you can reconcile the balance of the clearing accounts. Stand-Alone Disbursement Manager and Accounting Manager users will not have to worry about this.

Changing an owners interest from Net to JIB - A "net" owners balance is tracked with the suspense processing while a JIB Owners balance is tracked separately. If you change the way that the "JIB Int" option is marked for an owner's interest you will have to adjust both the suspense and JIB Balances for this interest if any exist. If you do not then the original balance will be left hanging and will cause a discrepancy with your reconciliations. We do not recommend changing the "JIB Int" option for an owners interest. If you have to do this, refer to the "Net Vs. JIB" topic in the help file first for instructions on how to properly transfer the balances between suspense and JIB Receivable.

Old Versions - Suspense Transfers - Prior to DMIE version 3 and AM version 6 the software did not transfer balances between the deficit account and the legal suspense account if an owner went from one suspense type to another. This usually worked itself out fine when the amounts were released but we have run into quite a few discrepancies from this. If your discrepancy is from a few years ago before the new suspense processing was released then it is likely related to the old processing. If this is the case then you can run the suspense report with a report type of "All Owner Suspense Entries" and compare that to the balance of both the deficit and the legal suspense accounts added together. You can then make a journal entry between these accounts so the balances are as they should be. It will then be easier to reconcile in the future.

Converted Suspense Balance - The suspense processing was completely recreated when DMIE version 3 and AM version 6 were released. If you used SherWare prior to these then you would have had to go through a conversion process to update your data to work with the new versions. Part of this conversion process was changing the suspense balances from the old processing and updating it so that it would work with the new processing.

To convert the suspense the balances for each owner were totaled by well. These totals were then added to the new version as a lump sum and will appear similar to the way a beginning balance type of entry would be look. This converted balance will be associated with the run number that would have been the last run processed in the old versions.

If you have an owner that has been in suspense since the old versions then the oldest suspense entry on the suspense report will not be from the run it is associated with but will be a total of the owners suspense balance at the time that the suspense was converted. This should stick out if you are doing a detailed reconciliation.

If you are doing a detailed reconciliation and everything in the new version reconciles except for the converted balance then you may consider making a journal entry to correct the balance as of that point. If you want to continue researching this to determine the discrepancy then you can view the "Old owner suspense report" (located under the "Other Reports" menu). This report will show you the detail of the owners suspense balance based on the old processing.

The ending total on the Old Owner Suspense Report will be the same as the beginning balance entry that was made on the current suspense report. The old report is showing a detailed breakdown of what made up that beginning balance entry. You can continue in your reconciliation by using this report for any suspense entries created prior to the conversion to the new software. The entries on this report should still match up with what posted to QuickBooks.