In the last part of our series on Closing Software (CS) we gave you a brief overview of what CS is and how it can improve month end. As an accountant myself, I was always looking for good ways to save time doing my account reconciliations. Performing recs with Excel can be a time consuming process, especially when reviewing thousands of line items. Fortunately, CS offers an alternative to Excel by integrating directly with your ERP and automating account reconciliations.
Here are some areas where CS can help with your account reconciliations:
Data from source documents and data from ERP’s are typically not uniform, which means there is extensive formatting required to perform the reconciliation process. In Excel, vlookups are only helpful to the extent that data between two sources is consistent. Cutting and pasting transactions can be a real hassle, especially if you have a large number of bank transactions and journal entries to compare. However, in CS, transactions and ledger activity are easy to review because of standardized forms and automated balancing features.
Efficient Comparison of Transactions
Account reconciliations inside of CS applications make it easier to line-up general ledger activity against your source document transactions, enabling you to find reconciling items much faster. Some CS systems even offer intelligent transaction matching, which is able to automatically review thousands of line items and identify reconciling items for your team.
Tracking of Historical Reconciling Items
Sometimes it’s easier to pass on correcting immaterial reconciling items until the next month. However, at some point in the future we’ll need to fix this item. Tracking reconciling items is very important, especially if your company has standards for how quickly they need to be corrected. CS tracks this data so you’ll always know where the historical reconciling items stand.
Account reconciliations are vital part of your company’s accounting function, making it important to perform them as effectively as possible. Look to CS to help improve accuracy and streamline the account reconciliation process.
In the next part of our 5 part series we’ll discuss exactly how CS can shorten close time.
Until then, Happy Closing!
Looking for a way to standardize and streamline your reconciliation process in Excel? Download our free best practice account reconciliation Excel templates.