Creditor (Vendor) Statement Reconciliation in Zoho Books

Q: Where do I see all vendor balances together?

In Reports &rarr; Vendor Balance Summary, or AP Aging to see how old each balance is.

Short answer

Get the supplier's ledger of your account and the vendor statement from Zoho Books for the same dates. Match them line by line: opening balance, bills, payments, vendor credits and TDS. Whatever is left is the difference. It is almost always a bill or payment missing on one side, a payment entered twice, TDS the supplier has not booked yet, or an entry dated across the period end. Correct the ones in your books and send the supplier a note of the rest.

How to do it

Get both statements for the same dates

Ask the supplier for their ledger of your account for a fixed period. For example, 1 April to 30 September.
In Zoho Books go to Purchases → Vendors and open the vendor.
Open the Statement tab and choose the same From and To dates.
Download it as PDF, or keep it open on the screen next to the supplier's ledger.

Match line by line

Start with the opening balance. If it does not match, the difference is in an earlier period. Find it first.
Tick each bill on both sides: same bill number, same date, same amount.
Tick each payment. Your payment made is their receipt.
Tick each vendor credit (their credit note) and any adjustment.
Whatever is not ticked is the difference. Write down each item with the reason.

Correct what is in your books

Bill missing in Zoho Books: enter it in Purchases → Bills with the supplier's bill number and date.
Payment entered twice, or against the wrong vendor: correct it, and check the bank line is still matched.
Their credit note not entered: enter it as a Vendor Credit and apply it to the bill.
Advance paid before the bill: apply it to the bill, so the bill is closed and the advance is not left open.
For items in their books, send the supplier a short note with the date, bill or payment number and amount.

Common mistakes

Matching only the closing balance. Two mistakes can cancel each other and the closing balance still matches. Match the lines.

Different dates. If their ledger is up to 30 September and yours is up to 31 October, it will never match. Always use the same dates.

TDS. When you deduct TDS and pay the balance, the bill is fully settled in your books. The supplier usually books the TDS part only after it shows in their Form 26AS or they get your Form 16A. Until then the TDS amount shows as pending in their ledger. That is a timing difference, not an error. Tell them the amount and the quarter.

GST on the bill entered wrongly. If the bill is entered without tax, or with the wrong tax, the amount will not match their bill and your input tax credit will also be wrong.

How to check in your books. Three checks. One: the total of Reports → Vendor Balance Summary must equal Accounts Payable in the trial balance on the same date. Two: for your main suppliers, the closing balance must agree with their ledger or with a balance confirmation. Three: the input tax credit you have taken for a supplier must agree with what that supplier shows in your GSTR-2B. Unmatched creditors lead to duplicate payments, wrong input tax credit and questions from your auditor at year end.

Common questions

How often should I reconcile vendor statements?

For the main suppliers, once a quarter at least, and always at the year end before the books are closed. Monthly for suppliers you pay very often.

The difference is exactly the TDS amount. What do I do?

Nothing in your books. Tell the supplier the TDS amount and the quarter it was deposited. They will book it once it shows in their Form 26AS.

Can I send a statement to the vendor from Zoho Books?

Yes. From the vendor's Statement tab you can email the statement for the period you choose and ask them to confirm the balance.

Where do I see all vendor balances together?

In Reports → Vendor Balance Summary, or AP Aging to see how old each balance is.

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How to reconcile a vendor statement in Zoho Books