Before You Start

This guide assumes advanced knowledge of Xero’s bank reconciliation interface. Proceed with caution.

Overview

20 min
Estimated Time
Intermediate
Difficulty
Monthly
Maintenance

What You’ll Learn

  • Identifying orphaned bank feed transactions
  • Safely using ‘Remove & Redo’ for miscoded entries
  • Reconciling Account Transactions with bank statement balance
  • Preventing future discrepancies in Xero

1. Understanding the Discrepancy

The ‘Account Transactions’ report should ideally mirror your bank statement. When it doesn’t, it often points to orphaned bank feed lines or incorrectly reconciled items.

Common Causes

  • Bank feed lines not matched
  • Transactions manually added and later matched to bank feed (duplication)
  • Incorrect “Remove & Redo” usage

Key Indicators

  • Bank Balance in Xero does not match actual bank statement
  • Transaction counts differ between Xero and bank statement

2. The ‘Remove & Redo’ Tool

The ‘Remove & Redo’ function is powerful but must be used with care.

Pros:
  • Cleans up miscoded or duplicated entries.
  • Restores bank feed lines for re-matching.
  • Essential for correcting reconciliation errors.
Cons:
  • Deletes transaction history permanently.
  • Requires careful re-reconciliation.
  • Can worsen discrepancies if misused.

Expert Tip: Always take a backup or screenshot of the transaction details before using ‘Remove & Redo’. This provides a reference point if you need to re-enter or re-match.

3. Step-by-Step: Fixing Orphaned Transactions

Follow these steps to systematically clean up your Xero accounts.

4. Guided Troubleshooting Workflow

  1. 1

    Run the ‘Account Transactions’ report

    Filter by date range and the problematic bank account. Export to Excel for easier comparison.

  2. 2

    Compare to Bank Statement

    Identify transactions present in Xero but not on the bank statement, or vice versa.

  3. 3

    Identify Orphans

    Look for transactions that have not been reconciled (no green ‘R’) or have been manually added and not matched.

Critical Tip: View All Transactions

Make sure you are viewing all transactions for the selected account, including reconciled and unreconciled ones, to catch all discrepancies.

5. Applying the Fixes

Correction Checklist

  • For unmatched bank feed lines: Find the corresponding transaction in ‘Reconcile’
  • For miscoded manual transactions: Use ‘Remove & Redo’ then re-enter correctly
  • For duplicated entries: ‘Remove & Redo’ the incorrect one (usually the manually entered one)
  • Verify bank balance matches statement after each major fix

Need Help?

Stuck on a Discrepancy?

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