How do I set up and use recurring transactions in my accounting software as part of the bookkeeping routine?

What is a recurring transaction, and how is the template different from what it posts?

A recurring transaction is two things that behave differently. The template is a stored transaction plus a schedule: the customer or vendor, the accounts and amounts, and the rule for when to repeat. The template itself is not an entry in your books. Each time the schedule runs, the software creates an ordinary transaction from it, which sits in your books like any entry typed by hand, unless the platform saves it as a draft or sends a reminder instead.

Zoho Books' help on recurring journals shows the split plainly. Each recurring profile has a Child Journals tab where you view the individual journals it auto-created.

Keep the two apart: a template decides what posts next, and an occurrence that already posted is a transaction in its own right, corrected by opening it.

Which repeating arrangements belong on a schedule?

Two tests decide it: is the event certain to happen on a known date, and is the amount known before it happens? The answers, together with the timing, set how each arrangement should be handled:

Intuit's article on creating recurring transactions gives rent payments, loan payments and depreciation as examples of scheduled transactions. A loan payment passes the tests only if the lender splits every payment between interest and principal the same way; the worked example below shows what happens when it does not.

A period-end adjustment whose amount depends on the period's actual activity does not belong on a schedule, because a schedule repeats a stored figure instead of measuring this period's. Which adjustments a business needs at period end is its own question.

What can go on a schedule, and what does the template hold?

Intuit's article on creating recurring transactions describes templates for recurring invoices, estimates and expenses. The template holds the whole transaction: you fill out the transaction details as you would for a single entry, then save them as a template. Zoho Books' help on recurring journals has you enter the debit and credit lines of the journal and requires the credit and debit values to be equal.

Some fields belong to one occurrence only. Intuit's article on editing a recurring template says templates do not fill in the service date on the transactions they create, so you find each transaction and enter the correct service date by hand. A field like that, or an amount read off a statement, is a reason to use a prompt.

How do I choose whether an occurrence posts on its own, prompts you, or waits until you use it?

QuickBooks Online has three template types, which Intuit's article on creating recurring transactions describes as follows:

• Scheduled. Transactions other than invoices can be sent automatically without any changes. Invoices are the exception, because the same article says each recurring invoice is saved as a draft for you to review and finalize.
• Reminder. The transaction is created at regular times, but you edit and send it yourself. Intuit's article on scheduling recurring templates says the reminder goes to your home page, where you decide which templates to use and edit them first.
• Unscheduled. Nothing happens on a date, and the transaction is created from the template each time you need it.

Zoho Books' help on recurring journals puts the choice of Draft or Published state for created journals in Settings, under General preferences; if any recurring journal varies in amount, choose Draft. For on-demand use, Zoho Books' Create Manual Journal action clones a recurring profile's details into a manual journal.

Choose with the table in the previous section, with one override: if nobody will review what posted, use a prompt. Only unattended posting can put a wrong record in the books with no one present, which is why it creates the review duty described below.

How do I set one up?

Setting up a template in QuickBooks Online runs in this order:

1. Open the recurring list. Intuit's article on creating recurring transactions starts at All apps, then Accounting, then Recurring transactions, where you select New and choose the type of transaction, such as an invoice or an expense.
2. Name the template so a stranger could tell what it is: the vendor or client, the arrangement and any known end date.
3. Choose Scheduled, Reminder or Unscheduled.
4. For a Scheduled or Reminder template, set the interval, which the same article says decides how often the transaction repeats.
5. Set the start date. Intuit's article on scheduling recurring templates explains that a template does not run on the day you create it: one set to start on the first of each month, created on the first, starts on the first of the following month. Zoho Books' help on recurring journals likewise says a past start date does not create journals for past periods. Record any occurrence the schedule skips, such as this month's, by hand or from the template.
6. Set the end condition. Intuit's article on fixing failed recurring transactions describes End as None, an end date, or a number of occurrences. Enter an end whenever the arrangement has one, such as the last month of a lease; choose None only when there is no known end, and put that template on the review list below.
7. Set any advance notice. Intuit's article on scheduling recurring templates says a Scheduled template can create its transactions a specified number of days before the transaction date, while the transaction date itself stays put; left blank, the transaction is created on the transaction date. For a Reminder template, Intuit's article on editing a recurring template says you set how far ahead the reminder arrives.
8. Fill out the transaction details and save the template.

Where do I see what is scheduled and what has already posted?

Two views answer different questions:

• What is scheduled. Intuit's article on scheduling recurring templates refers to the Previous Date and Next Date shown on the Recurring Transaction List and notes that both are based on the transaction date, not the date the transaction was created. For a report of every template, Intuit's article on fixing duplicate bank-feed transactions has you run the Recurring Template List report.
• What already posted. Intuit's article on editing a recurring template points to the Recent Automatic Transactions report for transactions recently created by a recurring template: you set the dates, run the report and select any transaction to open it. That article does not say whether the report lists entries made from a Reminder or with Use; check those in their accounts.

The lists show what the software will do, not why. For anyone else who works in the books, and for whoever takes them over, keep a short register with one entry per template covering these points:

• Arrangement. Name the lease, contract, subscription or loan, and where its document is kept.
• Amount basis. Say whether the amount is fixed, set from each bill, or taken from a statement.
• Behaviour and reviewer. Record how it posts and who reviews it.
• End and owner. Give the end date or ending event, and who changes the template when the arrangement changes.

How do I handle an amount that changes between occurrences?

The amount behaves in one of three ways, and each has its own route:

• Fixed. The template can carry the amount, and the schedule may post on its own. When a fixed price does change, edit the template before the next occurrence and correct any occurrence dated on or after the change that posted at the old price.
• Varies, and is known at each occurrence. Use a prompt, and replace the template's amount with the figure on this period's bill before you save.
• Varies on a basis the template cannot compute. Use a prompt and take every figure from the source document, or keep the template for use on demand.

Posting a varying amount unattended records a figure that was never charged. The entry looks routine, and the difference usually surfaces only when the account is reconciled or the vendor queries a balance.

What does a changing loan split look like?

A business pays its lender 1,500.00 each month. The template was built from the first statement: 400.00 interest and 1,100.00 principal. The sixth statement shows 380.00 interest and 1,120.00 principal.

Posted unattended, the template records 400.00 and 1,100.00 again. The bank item is still 1,500.00, so it matches the occurrence and the bank reconciliation shows nothing wrong. In the sixth month alone, interest expense is overstated by 20.00 and principal repaid understated by 20.00. Because the split shifted in earlier months too, the loan balance is overstated by the sum of every month's principal shortfall; agreeing each payment, or the loan account, to the lender's statement finds it.

As a Reminder, the same template arrives for review and you enter the statement's split before saving:

What happens to posted entries when I change, pause, end or delete a template?

Each action works on the template; what it does to entries already posted is documented for Zoho Books but not, in general, for QuickBooks Online:

• Changing. Zoho Books' help on recurring journals says that when you edit a recurring journal, the child journals generated previously remain unaffected. Intuit's article on scheduling recurring templates says changing the advance-creation setting does not change any existing transaction. Intuit's article on editing a recurring template says changes apply to "the recurring template and transactions that use the template" without saying whether that includes ones already created, so after an edit open a posted occurrence and check its values.

  If the template was wrong, correct each posted occurrence that carries the wrong value; if the arrangement changed, correct only occurrences dated on or after the change and leave earlier ones as posted.

• Pausing. Zoho Books' help says that once you stop a recurring journal, child journals are no longer created, and that you can resume a stopped one. Intuit's article on scheduling recurring templates describes switching a Scheduled template to Reminder, which keeps most of the schedule but gives you a reminder instead of an automatic entry.
• Ending. An end date or occurrence count stops the schedule at a point you choose, so set it as soon as you know the arrangement will end.
• Deleting. Zoho Books' help says deleting stops the recurring profile permanently, while the child journals it created stay available in the manual journals list. In QuickBooks Online, where Intuit's article on editing a recurring template gives the steps to delete one, run the Recent Automatic Transactions report first so you know what the template created. That article does not say what deleting does to transactions the template already created, so afterwards open one of them to confirm it is still in the books. Keep deletion for templates that should not exist, such as a duplicate.

How do I keep a scheduled entry and the bank item from both being recorded?

A scheduled rent payment and the rent debit arriving from the bank are the same movement of money, so the posted occurrence is the record the bank item should be matched to. Intuit's article on fixing duplicate bank-feed transactions names adding a downloaded transaction instead of matching it as one cause of duplicates, and tells you to match downloaded transactions to existing records instead of adding them. Adding it creates a second entry every cycle, so the duplicate compounds until someone reconciles the account.

If the bank amount differs from the occurrence, do not add the bank item as a second transaction. Find out why from the vendor's bill or statement, correct the occurrence to the amount actually charged, then match, and raise any overcharge with the vendor.

Three other patterns turn up at the same point:

• An occurrence with nothing arriving. A posted rent payment with no bank debit against it may mean the lease ended while the template kept running. Confirm the arrangement before you pair the occurrence with anything else.
• Two templates for one arrangement. Intuit's article on fixing duplicate bank-feed transactions has you review the Recurring Template List report for two templates with the same payee and amount and delete the extra one. Deleting it stops the next double; for copies it already posted, found in the Recent Automatic Transactions report, the same article has you keep the reconciled or matched copy and delete or void the other.
• A template used by hand. Intuit's article on scheduling recurring templates says that using a template before its date does not stop the scheduled run, so you then reset the schedule or delete the duplicate transaction when the system enters it.

Pairing, excluding and the platform's match suggestions are a separate subject from the schedule.

Why does a schedule that posts on its own need a review afterwards?

An unattended occurrence is not looked at when it is made, so any check comes afterwards. The PCAOB's AS 2110, an auditing standard addressed to auditors rather than to your business, says controls in a manual system might include approvals and reviews of transactions, and reconciliations and follow-up of reconciling items. A schedule that posts on its own removes the approval, which leaves review and reconciliation to catch what it gets wrong.

A template still running after its lease ended posts exactly what it was told, and nothing in the software knows the arrangement stopped.

Some templates move money as well as record it. Intuit's article on creating recurring transactions says its templates can schedule automatic credit card or ACH payments through Merchant Services, so a template of that kind left running after a client leaves charges the client. End those the day the arrangement ends.

The review therefore answers three questions: was each posted entry correct, did anything post twice, and did every arrangement that ended stop posting?

How does the schedule fit into the bookkeeping routine?

Check the schedule each period before you reconcile the bank account and close the period, in this order:

1. Let the period's last occurrences post. Look at the Next Date on each template for any date still inside the period. Intuit's article on scheduling recurring templates says recurring transactions are created on the scheduled day, typically between 12:00 am and 5:00 am depending on your time zone, and sometimes a little later depending on volume. Close only once the period's last occurrences show in the Recent Automatic Transactions report; otherwise one can land in a period you have already signed off.
2. Clear the drafts. Check each draft the schedule created, such as QuickBooks Online recurring invoices or Zoho Books journals saved as Draft, then finalize or publish it, or delete it if it should not exist.
3. List what posted. Run the Recent Automatic Transactions report for the period, or open each profile's child journals in Zoho Books.
4. Agree each occurrence to its document. Check rent against the lease, a subscription against its bill, a retainer invoice against the client agreement and a loan payment against the lender's statement.

5. Agree each occurrence to the bank. Each should have one bank item matched to it and none added beside it. An occurrence with nothing arriving against it is the sign of an arrangement that may have ended.

   If a second bank item arrives for one occurrence, check your bank statement: Intuit's article on fixing duplicate bank-feed transactions says a charge shown twice there really happened twice and has you work with your bank or payment processor instead of changing your books, so do not exclude it as a duplicate; recording it is a bank-feed task.

6. Look for doubles. Handle two templates for one arrangement as described above.
7. Correct and change. Fix posted occurrences one by one, then edit the template, switch it to a prompt or end it so the next occurrence is right.

If an occurrence has already landed in a period you closed, correcting a closed period is a separate procedure from maintaining the schedule.

Review the whole schedule, not only the period's occurrences, at year end, whenever the person keeping the books changes, and whenever one of these events happens:

• A lease, contract or subscription ends, renews or changes price.
• A client leaves or changes its retainer.
• An asset being depreciated is sold.
• A loan is paid off or refinanced.

For each template, confirm that the arrangement is still live, that its posting behaviour still fits the amount, that its end condition and register entry are current, and that its amounts, items, terms and tax settings still match the arrangement. Intuit's article on editing a recurring template says choosing Update for all when you edit an item or customer also updates all relevant templates.