Xero Bank Reconciliation Check

Verify bank and Xero balances match, flag mismatches for review.

Nora syncs bank transaction data into Xero and checks for reconciliation gaps. If the bank balance doesn't match Xero records, it alerts the finance team with a summary of unmatched transactions. Catches errors early and ensures accurate reporting.

Every Friday at 5 PM, Nora connects to Xero to retrieve the latest bank feed data and the current bank account ledger balance. It compares the raw bank transactions against the recorded Xero entries to identify any items that sit on one side but not the other. After calculating the total discrepancy and variance percentage, Nora sends a reconciliation summary to the finance team via email or web chat.

The finance manager no longer spends Friday afternoon clicking through pages of matched rows to find the gaps. They review the isolated list of unmatched transactions and investigate the flagged anomalies. They retain full control over the final reconciliation, telling Nora conversationally how to allocate unusual payments or when to create a manual journal for a missing fee.

Runs weekly on friday at 5 pm using Xero, run by your Finance Manager.

How it works

1. Trigger on schedule — Every Friday at 5 PM, the schedule initiates the check. Nora uses its stored OAuth credentials to authenticate with the Xero API, requesting a new access token if the previous thirty-minute token has expired.
2. Retrieve bank feed data — Nora pulls the recent bank transactions imported into Xero from the connected institutional feeds. It reads the dates, amounts, and reference details for all activity that has occurred since the last successful reconciliation date.
3. Read Xero ledger balance — Nora queries the corresponding Xero bank account records via the API. It retrieves the recorded ledger balance and the list of individual transactions already logged in the accounting system for that exact same time period.
4. Compare and identify mismatches — The system cross-references the bank feed against the Xero ledger. It isolates transactions that exist in the bank feed but lack a corresponding Xero entry, and Xero entries that have not cleared the bank.
5. Calculate variance totals — Nora sums the value of the unmatched items to determine the total discrepancy between the bank balance and the Xero balance. It calculates the variance percentage to highlight the scale of the gap for the reviewers.
6. Handle exact matches — When the bank balance and Xero ledger match exactly with no outstanding items, Nora stops the process. It sends a brief confirmation message stating the accounts are fully reconciled, requiring no human review.
7. Send discrepancy report — If gaps exist, Nora formats a summary listing the unmatched transactions and the total variance. It sends this report to the finance team's designated channel, highlighting large differences for immediate investigation by the staff.

What this replaces

A finance team member logs into Xero, opens the bank reconciliation screen, and visually scans the matched items. They scroll through pages of transactions to spot the lines that Xero could not auto-match. They manually calculate the difference between the statement balance and the Xero balance, then compile a list of the missing items to investigate.

• Log into Xero and open the bank reconciliation screen.
• Scroll through transactions to identify unallocated bank feed lines.
• Compare the statement balance against the recorded Xero balance.
• List outstanding items in a spreadsheet or email for review.

Rough estimate rather than a measured figure: about 45 minutes a week, based on 100-150 transactions and the manual effort of isolating the 5-10 anomalies.

What it needs to run

Accounts and plans

• An active Xero subscription
• A bank account with an active feed connected to Xero

Access it asks for

• accounting.transactions.read to pull bank transactions and ledger entries
• accounting.reports.read to check the overall bank account balances
• offline_access to maintain the OAuth connection beyond the 30-minute token expiry

What Nora reads

• Bank statement lines imported into Xero
• Account transactions recorded in the Xero ledger
• Current bank and Xero account balances

What Nora writes

• No direct writes to Xero records in this specific check
• Messages sent to the finance team's communication channel

When it goes wrong

• The Xero API rate limit is exceeded If the tenant hits the 60 calls per minute or 5,000 calls per day limit, Nora pauses the run. It waits for the limit window to reset before resuming the data retrieval.
• The bank feed has stopped syncing Nora detects if the most recent bank feed transaction is unusually old. It halts the comparison and alerts the team that the bank connection in Xero appears broken and requires manual re-authentication.
• A transaction is partially matched When a single bank payment covers multiple Xero invoices but the total falls short, Nora flags the transaction as an ambiguous mismatch. It lists the payment and the probable invoices in the report for human allocation.
• A previously reconciled period is altered If someone deletes a reconciled transaction from a past period, the opening balance for the current check will fail to match. Nora reports the opening balance discrepancy and refuses to proceed until the historical error is fixed.
• No transactions occurred this week If the bank feed and ledger are both empty for the period, Nora does nothing except send a single line confirming zero activity and a matched balance.

Who this is for

Worth it if

• Finance managers at 10-50 person companies processing hundreds of weekly transactions.
• Teams spending hours manually isolating outstanding items at month-end.
• Businesses with multiple bank accounts where minor discrepancies often compound.

Not worth it if

• Sole traders with fewer than 20 transactions a week who can spot anomalies at a glance.
• Companies that do not use Xero bank feeds and rely entirely on manual CSV statement uploads.

A worked example

A 30-person logistics company processes around 400 weekly payments. They ask Nora to run the reconciliation check every Friday afternoon and report the findings into their finance team's WhatsApp group.

Xero Reconciliation Check: Main Operating Account

Status: Mismatch detected
Bank Balance: $42,550.00
Xero Balance: $41,300.00
Variance: $1,250.00

Unmatched Items:
- 12 Oct: Inbound transfer $1,400.00 (Bank feed only, no Xero invoice found)
- 14 Oct: Outbound fee $50.00 (Bank feed only)
- 15 Oct: Supplier Payment $200.00 (Recorded in Xero, not cleared in bank)

Please review these 3 items to complete the weekly reconciliation.

Frequently asked questions

Does Nora actually reconcile the transactions in Xero?

Not in this specific automation. This process is a read-only check designed to find the gaps between the bank feed and your ledger. Nora compiles the list of anomalies so your team can investigate them. If you want Nora to allocate payments or create manual journals, you can ask it to perform those actions separately.

How do I change the variance threshold for what gets flagged?

You tell Nora in plain language. If you want it to ignore outstanding checks under $10 or only report discrepancies larger than $100, you send a message in your chat channel specifying the new rule. Nora updates its instructions immediately and applies the new logic to the next scheduled run.

What happens if my Xero token expires?

Xero access tokens expire every 30 minutes. Nora handles this using the offline_access scope and a refresh token, which lasts for 60 days. It automatically requests a new access token in the background before running the scheduled check, requiring no manual login from you.

Can it check multiple bank accounts at once?

Yes. Nora can iterate through every active bank account connected to your Xero organization. It pulls the feed and ledger balances for each account sequentially, and compiles a combined report that separates the discrepancies by account name so your team can review the entire business position at.

Connects to

• Xero — all 6 Xero automations

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